Omnichannel fulfillment is one of the biggest trends in logistics this year, largely fueled by the massive growth of ecommerce since the pandemic. Forecasts estimate that ecommerce sales in the United States will surpass $1 trillion in 2022, years ahead of previous pre-pandemic predictions that saw the U.S. reaching this benchmark in 2024. The same forecasts see ecommerce revenue surpassing $5 trillion worldwide this year.
Undeniably, this rapid growth of ecommerce has become a significant driver of profitability in the industry, but this growth often conflicts with a company's sustainability efforts. The ecommerce supply chain creates environmental harm at every stage—from production to delivery.
The Environmental Impact of Ecommerce
Aside from the well-known detrimental effects of manufacturing on the environment, ecommerce also creates a lot of waste in shipping and packaging. Every year in the United States, the cardboard boxes used to ship packages equate to 1 billion trees, not to mention the unrecyclable plastic, bubble wrap, and tape, which all end up in a landfill. In fact, in 2019, Amazon packages created 465 million pounds of waste, a figure that has probably only risen since the pandemic-era ecommerce boom.
Transporting ecommerce deliveries creates even more environmental issues. According to the Environmental Protection Agency, about 29% of all U.S. greenhouse gas emissions are attributable to transportation, with an estimated 12% directly from freight activity. Regarding last-mile delivery, a study by World Economic Forum projects a 36% increase in the number of delivery vehicles in the top 100 cities globally, creating a 30% increase in carbon emissions by 2030.
Ecommerce returns are another major contributor to environmental woes. Global ecommerce returns represent 20% of all purchases—a figure much higher than with traditional in-person shopping—and these returns have a significant carbon footprint from transportation back to warehouses. Returns also generate a lot of waste; aside from the packaging of shipping a return to the warehouse, statistics show that over 10,000 tons of returned goods go to landfills each year.
Going green is a growing concern for many consumers, with many—especially millennials and Gen Zers—moving away from brands that do not prioritize sustainability. According to a study by Descartes and SAPIO Research surveying consumers in the United States and Europe, “65% of respondents think twice about ordering online due to the environmental impact,” with many respondents willing to sacrifice speed for sustainability. Bringing sustainability into the supply chain may be a challenge, but it is also an opportunity to appeal to more consumers.
How 3PL Warehouses Can Help with Sustainability
There are two key ways that third-party logistics (3PL) warehouses can help with sustainability efforts relating to ecommerce—omnichannel fulfillment and innovative technology.
When a warehouse implements omnichannel fulfillment practices, pulling inventory for orders across channels with a unified system, they enable brands to offer flexible delivery options for ecommerce orders (e.g., buy online pick up in-store (BOPIS) and curbside pick-up). Traditional ecommerce, where orders placed online are delivered directly to the consumer’s doorstep, creates a ton of carbon emissions with last-mile delivery. Combining orders for delivery to a brick-and-mortar storefront for BOPIS or curbside pick-up significantly reduces these emissions.
Furthermore, brands can offer services to deliver all their orders together once fulfilled rather than splitting orders into multiple packages that increase the number of deliveries to a single address. This would also allow consumers more time to cancel or change orders—fewer returns mean less waste and environmental pollution from transportation. Most notably, it gives warehouses more time to fulfill orders and ship them in less packaging versus shipping split shipments where a multi-item order is divided into multiple packages.
On the topic of packaging, warehouses should always ensure they use minimal packaging, so they ship products—not air—and decrease the amount of cardboard waste that ecommerce produces. Having a variety of packaging sizes and shapes is a minor but essential step towards greening ecommerce fulfillment because it also reduces the carbon footprint of shipping ecommerce orders. If a truck is filled with over-packaged shipments, it is not using space efficiently. On the other hand, if orders are packaged in the correct size packaging, each truck can fit more shipments in it and reduce the number of trucks needed to transport orders.
There are several ways that implementing a warehouse management system (WMS) helps sustainability in the warehouse. First off, WMS software allows warehouses to adopt entirely paperless warehouse processes for ecommerce fulfillment, which reduces paper waste and is not only great for the environment, but for profitability, too. Second, many WMS platforms automatically suggest packaging recommendations to lessen waste. Finally, WMS software that automates picking processes ensures higher picking accuracy, which can reduce returns if orders are more accurate. If a return does happen, a WMS can revamp the returns process so that warehouses can reuse returned merchandise.
An order management system (OMS) also leads to more sustainable warehouse practices by aggregating orders to create efficiencies by fulfilling orders from the correct node in the supply chain. An OMS, like a WMS, also guarantees higher order accuracy, which reduces the number of returns made for ecommerce orders. With smart order routing, an OMS facilitates omnichannel commerce decreasing both the retailer’s and the warehouse’s carbon footprint. When paired with WMS software, an OMS creates an efficient tech stack that can be crucial to sustainability efforts.
To learn more about industry trends for the year, including omnichannel fulfillment, read the 2022 State of the Third-Party Logistics Industry Report.
Written by Ashley Hawkins
Ashley Hawkins has over 5 years of experience in applied mathematics, previously working as an editor and copywriter in engineering and tech. She now works as a Content Marketing Specialist at 3PL Central where she writes content on industry trends and best practices. With experience in research and consulting on software workflows, Ashley is passionate about the future of technology and logistics.