Wal-Mart Canada Supply Chain Goes Green

Source Canada News Wire: As part of its company-wide sustainability program, Wal-Mart Canada is spearheading collaboration among supply-chain companies to measure and reduce the environmental footprint of its product shipping process and logistics network. The company announced today it will introduce its first ever Supply Chain Sustainability Scorecard
this fall to assess its network of service providers on the basis of environmental impact, efforts and improvement.

This month, Wal-Mart Canada assembled dozens of companies, including some of Canada’s largest trucking, rail, storage and distribution suppliers, to begin the process of quantifying various sustainability measures relevant to its product shipping processes and practices. The meeting allowed Wal-Mart to outline its new expectations of supply-chain service providers, and to establish relevant and agreed categories for its upcoming scorecard.

“As a company, Wal-Mart has introduced sustainability programs and measures throughout our business,” said Lesley Smith, Wal-Mart Canada’s vice president of supply chain. “Our new rules for supply chain sustainability will cover everything from fuel use, to facilities and equipment standards, to the overall environmental commitment demonstrated by the companies we hire to ship and store our products. As always, the business case and payback is twofold: a
better operation with better environmental effect.”

By moving goods more efficiently, Wal-Mart Canada and its supply-chain service providers expect to directly contribute to the company’s everyday-low-cost approach – lowering costs to ensure the lowest prices for customers, a key to Wal-Mart’s business model. At the same time, by reducing materials, increasing efficiency, and eliminating unnecessary shipping, the
company and its suppliers will meet rising environmental standards.

In July 2006, Wal-Mart Canada and shipping supplier SCM changed the mode of transporting goods destined for 10 stores, located in Nova Scotia and PEI, from road to rail. This change has reduced carbon emissions by 2,600 tonnes.

For necessary road delivery, the companies converted 20 truck generators to electric power, saving 40,000 litres of fuel. Combined, these two measures are expected to deliver annual cost savings of more than $2 million.

By changing some shipping crates from cardboard to plastic, allowing boxes to be used approximately 60 times instead of once, Wal-Mart Canada has saved $4.5 million in costs, with expected waste reduction of more than 1,400 tonnes and carbon emissions reductions of 10,000 tonnes, due to the elimination of cardboard production. This Canadian initiative has become a
best practice for other global Wal-Mart operations.

In the coming months, Wal-Mart will “footprint” its supply chain operation, and has asked service providers to audit their respective environmental impact related to operations on behalf of Wal-Mart Canada. This will provide a quantifiable benchmark for future improvements.

“Our supply chain activities were already exceeding government and industry gold standards,” said Smith. “Together, with our suppliers, we’ve decided we can do better and we can set new standards.”

In October 2007, with the introduction of the Supply Chain Sustainability Scorecard, Wal-Mart Canada plans to assess the businesses it hires to ship and store its products based on four categories:

– Equipment – e.g. use of sustainable alternatives, efficient engines and tires, etc.
– Operations – e.g. enforcement of programs for recycling, vehicle idling, oil collection, etc.
– Facilities – e.g. responsible energy use (including green power), efficient buildings, etc.
– Corporate commitment – e.g. a vision or culture of sustainability throughout the business.

Wal-Mart has committed to three long-term sustainability goals, globally and in Canada:

1. To produce zero waste;
2. To be powered 100 per cent by renewable energy; and,
3. To make more environmentally preferable products available to customers.

Headquartered in Mississauga, Ontario, Wal-Mart Canada Corp. operates 290 retail operations nationwide. The company’s environmental vision is to demonstrate environmental leadership by reducing the ecological impact of its operations through company-wide programs focused on waste, energy and products, as well as outreach programs that preserve and enhance local
environments.

For further information: Kevin Groh, Director, Corporate Affairs, Wal-Mart Canada Corp.,
(905) 821-2111 x8012

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