Green Manufacturing: Supply Chains and Marketing

Green manufacturing has become a powerful marketing tool. Consumers increasingly have begun buying green products that are more cost effective and healthier and leave less of a carbon footprint on our planet. As a result, manufacturers are developing products that fit this need. At the same time they are implementing supply chains that are greener.

The basics of green manufacturing focus on minimizing the impact of the manufacturing process on the environment. It begins with the development of green products and extends to implementing a green supply chain. Once this has been done, green manufacturing can be turned into a marketing advantage. Manufacturers viewed as being green, such as Toyota and General Electric, have converted the concept into more sales.

Green Manufacturing

The following are some basic characteristics of green manufacturing:

• Less consumption of natural resources
• Less energy used in production
• Less gas and toxic material released into the environment
• Less waste created from the manufacturing process

Product development studies show that the design stage determines 70 percent of a product’s environmental impact. Paper made from chlorine-free bleach and a light bulb that uses half the amount of electricity are two products that have lessened the impact of manufacturing on the environment. One reduces the amount of a toxic material and the other reduces consumption of natural resources, which in this case translates into saving money by cutting energy costs.

Government agencies are now buying more green products and services. Between federal, state, and local, this amounts to more than $600 billion in sales. In response to governmental needs, several green products are under development. These include both plastic flatware (forks, spoons, and knives) and plastic garbage bags that are biodegradable. Biodegradability results in a substantial savings for many local communities that pick up green waste. If customers gather leaves and such into plastic bags, the garbage company has to remove all the bags, which is costly. With the biodegradable garbage bag, everything can be composted together, and that translates into huge savings.

Green Supply Chain

To be successful, green products require a green supply chain. Supply chains involve everything from the purchase of production materials to the delivery of the finished product to the customer. This means every aspect of a business needs to adopt a green approach. To make this happen, manufacturers need to implement an overall green strategy.

One company that implemented a green supply chain strategy is Custom Print. An offset lithographic printer of commercial color products with annual sales of $4 million, Custom Print made the decision to green its process, which wound up saving approximately $40,000 annually. The areas concentrated on include the following:

• Streamlining inventory: It reduced onsite inventory of chemicals by 70 percent with a savings of $5,000 a year in inventory and waste disposal.
• Modifying ventilation: After switching its fountain solution to an alcohol-free system, it created a healthier working environment for employees and cut electricity costs by 40 percent, saving $26,800 annually.
• Reducing wasted ink: It trained employees to mix specialty colors from existing ink stock, reducing waste while saving $8,000 a year.

Green Marketing

As a manufacturer, once you’ve created green products and implemented a green supply chain, the next step is marketing to your customers. This involves 1) getting your product certified, 2) including your product in green procurement systems and lists, 3) appropriately labeling your green product, and 4) developing strategies for marketing. Two organizations that certify green products are Green Seal and Scientific Certification Systems.

When developing strategies for green marketing to consumers, manufacturers need to keep these key concepts in mind:

• Understand green consumers, and through their needs, identify opportunities for green products.
• Emphasize the direct benefits of a product, such as health or overall cost.
• Give consumers the information they need to buy green while maintaining your credibility by only making substantiated claims regarding your product and supply chain.