Environmentally Preferable Purchasing is an Easy Step to Manage Your Supply Chain

2 Sep

In this increasing “green” business focused economy, there are a plenitude of purchasing guides focused on assisting suppliers and customers in making environmentally friendly’ product choices.  The City of San Francisco launched a  database of products that meet the city’s preferred purchasing standards. The SF Approved List of over 1,000 required or suggested products is the result of a 2005 ordinance that instructs city staff to steer clear of environmentally harmful products.  The City established a “one-stop shop for over 1,000 green products that:

  • SF City Staff are required to buy under City ordinances.
  • SF Green Businesses are allowed to use.
  • Can green your home, small business or large organization.”

But while the newly-completed database is intended primarily to assist city staff, it’s also a helpful tool for anyone seeking unbiased information about green products.   In addition to the network of city staff that work at “keeping it real,” the city also relies on chemical hazard data from GoodGuide in making its decisions.

This transparent move by the San Francisco underscores a trend that more and more state and local governments and private companies are adopting- moving away from the “low bid always wins” mentality and toward the more flexible “best value” approach.  “Best value” allows a purchaser to incorporate a broader variety of considerations, including performance and environmental attributes, when making purchasing decisions.   Best value and environmental product specifications are making their ways into a number of common administrative, production and maintenance areas- for instance: office paper, lighting, paints and solvents, chemicals, building materials (like carpet), etc.

Characteristics and Steps to Green Your Purchasing Power

Environmentally preferable purchasing policies (EPP) can take many forms and serve a variety of pre-purchase and performance goals.  A sound EPP should:

  • Include an explicit statement of commitment from top management that explains relevance to broad goals of the organization
  • Be incorporated in standard and routine procurement procedures such as in relevant manuals or documents, procedures of purchasing agent
    • Address potential obstacles such as purchase price vs. life-cycle costing
    • Provide detailed guidance on key issues when possible (e.g., energy efficiency, toxics)
    • Explicit designation of authority and responsibility for green procurement
      • Include green purchasing in annual performance reviews for relevant employees
      • Provision of rewards or incentives for superlative performance in achieving green procurement goals
      • Require monitoring and reporting on performance against explicit targets

Getting started in developing an EPP may be easier than you think:

  • Review and analyze current purchasing by major product categories
  • Prioritize product categories in terms of environmental impact and improvement potential
  • Develop a multi-year implementation schedule based on priorities, difficulty, upcoming solicitations
  • Produce a manual of standards & specifications, address cost/availability issues that might arise
  • Review policies, procedures, organization, and make improvements as needed
  • Develop metrics and report on progress

Finally, it’s important when you develop an EPP to balance the following

  • Environmental benefits
  • Cost
  • Availability
  • Performance

Resources to Get You Started

This post was originally published on my New Green Supply Chain Blog, which can be found at https://community.kinaxis.com/people/DRMeyer/blog

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