Despite the hue and cry that went up when we learned that the US Olympic team uniforms were ‘manufactured overseas,’ the reality is that MILLIONS of US workers rely upon and contribute to, the global value chains (GVCs) that design, produce, market, ship and deliver leading brands such as Polo (Ralph Lauren).  Our kudos to Moongate & Associates, for its study published this month (and commissioned by the TPP) which clarifies with impressive supporting data, that the perception that there are two categories into which apparel falls:  imported or ‘made in the USA,’ is simplistic and outdated in today’s global economy.

In fact, according to this study, on average 70.3% of the retail price of studied apparel is value added by high paying US jobs.

Most of the lowest skilled jobs are done overseas, leaving the more highly skilled professional employment concentrated in the United States.  These jobs are spread throughout the stages of U.S. value–‐added beginning with fashion designers (average salary $73,640), and fabric and apparel patternmakers ($48,110), and continuing with transportation, storage, and distribution managers ($82,923), compliance officers ($66,620), software developers ($95,283), and sales managers ($111, 283). Moreover, there are high–‐quality blue–‐collar jobs throughout the chain; for example, cargo and freight agents ($45,100), production, planning, and expediting clerks ($41,060), industrial machinery mechanics ($45,740) 9, railroad employees ($76,574) 10, and longshore workers ($124,138)11.

http://www.tppapparelcoalition.org/uploads/021313_Moongate_Assoc_Global_Value_Chain_Report.pdf

Maybe this data could be included in the next news report on this topic?

-Michele Carroll 2/25/2013

Ian A. Gentis
Reclipse Group
Monday, May 14th 2012

While the science of global warming is being debated, there is no doubt about a new metric coming to your supply chain: the carbon footprint. The measurement of greenhouse gas (GHG) emissions has become another plank in companies’ Corporate Responsibility platforms, and there is a good chance that you will be asked to provide your carbon footprint data in your next RFP response.

Here’s good news: Companies large and small that have decided to focus on reducing greenhouse gases as responsible policy, are finding out that they can save money.

The basic approach is to conduct a study of the carbon footprint of your supply chain as part of your product life cycle analysis (LCA).

Here’s some bad news: There is a lot of “junk science” and snake oil being offered up and some companies making honest efforts to understand their carbon footprint have had poor results.

Over the course of the next several blogs, we’ll explore the progress being made, offer resources and suggestions, and help you navigate through the hype to reach your goals.

So what is this all about?  A definition of carbon footprint

Our friends at Carbon Trust (www.carbontrust.com) in the United Kingdom (UK) helpfully offer this definition:

A carbon footprint measures the total greenhouse gas emissions caused directly and indirectly by a person, organization, event or product.

A carbon footprint is measured in tonnes of carbon dioxide equivalent (tCO2e). The carbon dioxide equivalent (CO2e) allows the different greenhouse gases to be compared on a like-for-like basis relative to one unit of CO2. CO2e is calculated by multiplying the emissions of each of the six greenhouse gases by its 100 year global warming potential (GWP).

A carbon footprint considers all six of the Kyoto Protocol greenhouse gases: Carbon dioxide (CO2), Methane (CH4), Nitrous oxide (N2O), Hydrofluorocarbons (HFCs), Perfluorocarbons (PFCs) and Sulphur hexafluoride (SF6).

There are two types of carbon footprinting

The main types of carbon footprint for organizations are:

1. Organizational carbon footprint

Emissions from all the activities across the organization, including buildings’ energy use, industrial processes and company vehicles.

2. Product carbon footprint

Emissions over the whole life of a product or service, from the extraction of raw materials and manufacturing right through to its use and final reuse, recycling or disposal.

To get to a carbon footprint of the supply chain we will draw on both types of footprints.

What outputs can I expect from a carbon footprint? Some examples of carbon footprints

Let’s take a look at a recent carbon footprint study at Sprint Nextel (To review and download the full study, registration is required, but is free).

Sprint Nextel spends $13.5B annually on the 162 suppliers in its supply chain. Economic consultants Trucost (www.trucost.com) conducted a supply chain carbon footprint. A summary of their findings:

The carbon footprint of the Sprint Nextel supply chain is very concentrated in a few suppliers.

• The top 5 suppliers contribute to 58% of the total carbon footprint of the supply chain.
• The top 50 suppliers account for over 94% of the total carbon.
• Manufacturing is the most carbon intensive sector, accounting for 83% of the total carbon emissions and 67% of the expenditure.
• A total of 121 suppliers from Sprint Nextel’s supply chain are located within the top three sectors.

What can I do with this information?  Make plans to reduce your carbon footprint

Turning again to the Trucost Sprint Nextel study:

Measuring and understanding carbon footprints is the first step to towards managing and reducing them. Sprint Nextel can play a role in promoting emission reductions in the supply chains of its suppliers:

Develop low-carbon procurement strategies:

• An understanding of the main sources of emissions within supply chains could inform low-carbon procurement strategies.
• Baselines can be used to set carbon reduction targets for procurement.
• Include a requirement in tenders for suppliers to report carbon emissions data. Greater transparency can help identify opportunities to reduce emissions and demonstrate improvements in carbon performance.
• Carbon prices can be applied to emissions data to inform procurement decisions.
• Identify opportunities to monitor and share cost savings achieved through improvements in energy and carbon efficiency with procurement.

Inform engagement with suppliers:

• Identify the companies and sectors where engagement could be most effective to reduce supply chain emissions.
• Engage with suppliers that contribute most to carbon footprints, and are carbon-intensive compared with sector benchmarks, to encourage improvements in carbon efficiency.
• Ask suppliers to develop action plans to manage GHG emissions and monitor their performance. Encourage them to focus on improving the efficiency of fuel and electricity use so that they benefit from both carbon and cost savings.

For further reading, here is an interesting white paper from our friends at Carbon Trust which is no longer hosted on their website. (Understanding & Optimizing SC Carbon Footprints PDF)

HP publicly debates getting out of the PC business. Nokia’s market-share has slipped to less than 30% of the market for the first time since 1999. RIM’s “crack-berry” is withering in the sun of iPhone and Android. What’s it all about? And what impact do these OEMs’ market challenges and their operational responses have on their partners – especially the 3rd Party Logistics Service providers and the Electronic Manufacturing Service providers? These partners took over the management of large portions of their OEMs’ supply chains – taking on the assets and associated labor required to operate them. Is there a shift going on with these OEMs that could force major strategic decisions on the part of the 3PLs and the EMS providers? We have some thoughts about this. How about you?

“Carbon footprint” is a term used to describe the amount of greenhouse gas (GHG) emissions caused by a particular activity or entity, and thus a way for organizations and individuals to assess their contribution to climate change. Understanding these emissions, and where they come from, is necessary in order to reduce them. In the past, companies wanting to measure their carbon footprints have focused on their own emissions, but now they are increasingly concerned with emissions across their entire supply chain.

Supply chain GHG emissions, which include those associated with processes not controlled by the company itself, can be measured at either the company level or the level of an individual product.

While PAS 2050 provides a standard method for assessing a product’s carbon footprint, this guide, “Guide to PAS 2050″, will help businesses to implement the standard by offering specific and practical guidance. It is not a replacement for PAS 2050 and should always be used alongside PAS 2050. There are benefits to both company- and product-level supply chain emissions assessment; however, PAS 2050 and this guide focus on product-level emissions only.

This guide aims to:

- Enable companies of all sizes, and from all industries, to assess the life cycle carbon footprint of their products and to identify emission reduction opportunities

- Share best practices, tools and frameworks for calculating product-level GHG emissions and prioritizing opportunities to reduce emissions

PAS 2050 and this guide focus exclusively on GHG emissions created during a product’s life cycle.

Visit the Carbon Trust website (http://www.carbontrust.co.uk/Pages/Default.aspx) to download supporting documents such as the PAS 2050 Specifications, the Guide to PAS 2050, and the Code of Good Practice.

Paul Tasner
Reclipse Group, Inc.

http://www.eco-opscenter.com/report-download.php

A 90-page report and survey findings detailing the forces and
factors driving supply chain executives toward greater levels of
environmental responsibility, visibility, collaboration and
accountability.

Paul Tasner
Reclipse Group, Inc.

Opportunities to Reduce GHG Emissions Through Materials and Land
Management

http://www.epa.gov/oswer/docs/ghg_land_and_materials_management.pdf

First, in order to increase understanding of the link between
materials and land management and GHG emissions, this document
presents an estimate of the portion of U.S. GHG emissions associated
with materials and land management practices. Second, it presents a
set of materials and land management scenarios—referred to as total
technical potential scenarios—as a first step to identifying areas of
opportunity for EPA and its partners to reduce GHG emissions through
materials and land management.

Products, Packaging, and US GHG emissions

http://www.productpolicy.org/content/climate-change-epr

This paper builds on a new report from the U.S. Environmental
Protection Agency, “Opportunities to Reduce GHG Emissions through
Materials and Land Management Practices,” which offers new insight
into the impact of products and packaging on climate change. Based on
the report, non-food products are associated with 37 percent of U.S.
greenhouse gas emissions. This paper extends the EPA analysis to
include the impacts from producing products abroad that are consumed
in the U.S. This brings the share of products and packaging to 44
percent of total U.S. greenhouse gas emissions.

Paul Tasner
Reclipse Group, Inc.

For the past couple of months I have been volunteering with the Cleantech Open (CTO – www.cleantechopen.com) here in Northern California. The CTO is a business plan competition held in 3 regions in the Western U.S. The groups are provided with opportunities to learn about business planning, get feedback, practice their presentations, and be mentored to what they hope will be a winning business plan – for both the competition and to get funding from a VC…

Most of my time has been spent helping with the CTO’s first Operations Industry Clinic which was held last Thursday evening at the offices of a very interesting company, D2M (Design to Manufacturing – www.d2m-inc.com), in Mountain View – but more about them later.

There were 2 presenters who gave both valuable information and examples which the CTO contestants could use in developing their specific prototypes and operations / mfg / supply chain processes and business plans. The evening was a very good primer on all aspects of manufacturing and operations with particular info on how to decide whether to contract out or start your own. The biggest take-away for me was that either way a company needs to maintain visibility and control over their suppliers, service providers, and quality processes. It also underscored how operations decisions have the potential to make or break a new or existing company.

Paul Tasner from Method Products (www.methodhome.com) was the second presenter and he walked the group through the issues and challenges he had encountered when he joined Method to run their supply chain operations. He talked about the distribution changes he had implemented, the challenge of being a small fish in a large pond but still working out sustainable solutions with his service providers, and to never underestimate what you can accomplish.

Two people from D2M’s management team also participated in the interactive presentations by giving the group the benefit of their experience, particularly around prototypes and contract manufacturing (they have worked with many existing companies and start-ups). After the official clinic discussions were over we broke into 2 groups and got a quick tour around the D2M facility.

Tim Billing, COO, led the group that I was in. D2M is moving toward more project based work groups and open cube seating. They are finding that it makes for more innovative and collaborative results. Tim described a number of the projects they are involved in – some cleantech related (eg a better toilet) and some humanitarian related (easier ways to transport water for women in Africa).

The entire evening was very successful, good food (provided by D2M), good information, and some real-world examples of people helping people and the planet. Very much aligned with the reason people get involved with cleantech in the first place!

Susan Rosin
President, Reclipse Group