Does upscaling your environmental credentials have to cost you?

with David Ramm, former Manager of Booths, Keswick

Businesses throughout the UK are looking at ways to ensure that their work, their products, their people and their customers are contributing positively to the environment.

Environmental CSR can, however, be costly. The change required to underpin a corporate environmental conscience with action is likely to incur costs across education, new processes, new equipment and software. Procurement teams, while astute in other areas, more often than not, lack the expertise and market knowledge to adequately source the required consulting and equipment around their environmental goals.

It is here that supply chain intelligence comes into its own. Market knowledge based on intelligent data across various industries, together with the ability to invest dedicated time and resources, creates value – the kind of value in-house teams will find difficult, if not impossible, to emulate. This, coupled with the sheer speed and complexity of today’s business, has created an ideal opportunity for dedicated supply chain and cost-reduction providers to offer procurement expertise in the area of waste and recycling.

David Ramm, former Manager of Booths in Keswick and now a cost management consultant with Expense Reduction Analysts (ERA), explains how businesses can cut the cost of transitioning to top tier environmental practices.

“Having worked for Booths for more than 27 years, I know how dedicated northern retailers are to sustainable waste management and the use of recyclable, even fully compostable materials. The environment is a key issue for us all. It was therefore no surprise to me to see that numerous of my new clients are investing time and effort into ensuring their businesses meets environmental standards.”, says David.

“The main stumbling blocks for companies in this endeavour, however, is their lack of time and expertise around this subject matter, particularly with regard to procurement. A client might say that they will look into the cost of one particular piece in the change chain towards environmental compliance, but just does not have the breadth of granular knowledge nor the buying power they need to identify significant cost reductions. This is where cost reduction analysts come in and can offer dedicated time and a granular approach as well as incredibly well-researched data.  

We recently worked with DFS who were looking to take their waste management to ZERO to Landfill. The project called for a new recycling system, which was going to create a fair amount of cost. Backed by the CEO, it was clear that this was a significant and important project for the company and that they were willing to invest in it. At the same time, however, they needed to find suppliers who could help keep the cost down.

Working with DFS allowed us to leverage our market expertise and create well-researched and effective offers from a number of providers which ultimately helped deliver on DFS’ ZERO to Landfill goal. It was a great project and a fantastic example of how knowledge of the supply chain can impact the bottom line. It also showed that the cost of transitioning to a higher-level environmental standard can be reduced if you work with solid market data.  

Here, a snippet from the DFS case study:

“From day one, DFS were very keen on the Waste project,” says Hugh Swainston, Client Manager at Expense Reduction Analysts. “We met with Phil Johnson, then Facilities and Services Manager, and he was enthusiastic not just about the money that could be saved, but also about achieving the corporate goal of reducing waste and increasing recycling. And he recognised that DFS did not have the skills to do this themselves. “The project was signed of at CEO level, which gives you some idea of the backing that it enjoyed.

“The handling of waste across the supply chain is a huge undertaking for a business as large as DFS. Significantly, the first initiative was around a new recycling system at their Head Oce, with the ultimate target of sending zero waste direct to landfill. This was a bold statement by DFS management, and a demonstration to everyone in the business of their determination to change the culture around waste. “I was fortunate to be able to call upon the expert knowledge of my colleague, Pete Bramhall, a WasteManagement Specialist, to co-ordinate the many elements of the project.”

The beauty of this business model is that companies get the expertise and the data analysis and do not incur cost until they have chosen their preferred suppliers. This way, the client chooses the option they are most comfortable with and is sure to make the most effective procurement decisions.

Pete Bramhall: “The Head Oce ‘zero to landfill’ target was a great start, giving our activities increased visibility and credibility. We then reviewed the waste produced by DFS warehouses, factories and stores, adopting a phased approach to change comprising ten dierent initiatives. “For example, we reviewed the waste handling equipment – polythene balers and general waste compactors – renegotiating the maintenance agreement on these 200 pieces of kit, saving DFS 20% or £32,000 per annum. These machines are frequently relocated as new stores and warehouses open and others close, so we also helped DFS to manage this more effectively to optimise the equipment’s utilisation.

David Ramm explains: "I have been in business for a long time and am seeing a trend where more and more companies are seeking partnerships like the one between DFS and Expense Reduction Analysts.  Key in the process is a joint desire to accomplish something that is beneficial to us all and a relationship built on trust.

Times are changing. Businesses find themselves evermore caught up in having to comply with various market requirements and wanting to meet CSR goals while also finding ways to cut cost. I believe that we will see more and more companies reach out to cost management specialists who can help them overcome time-constraints, achieve their goals and deliver on cost as well as environmental challenges. Knowledge sharing and the use of in-depth data will certainly be paramount as we move forward.”

You can contact David Ramm here: dramm@expensereduction.com

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Jutta Devenish