Environmental concerns have taken stage and businesses are quickly adapting to support those concerns. Around the globe, businesses are taking measures to minimise their carbon footprint and promote sustainability. One such solution that has risen in popularity is B2B e-commerce. With the power of digital platforms, B2B e-commerce revolutionises the ways that businesses can interact with customers. It is also said to provide many environmental benefits over the traditional B2B model. But does it really?
The positive impacts of B2B e-commerce on carbon emissions, waste, and efficiency may very well be true. However, things may not be that clear cut. Let’s take a deeper look at it.
Reducing carbon emissions
Transportation is one of the biggest contributors to greenhouse gas emissions (15% alone). B2B e-commerce can offer a solution to this by removing the need for physical meetups and extensive travel. B2B e-commerce can replace many physical interactions with virtual interactions. Digital platforms allow for instant information transfer without the need for physical meetups. In this way, the carbon footprint of sales reps can be curtailed.
On the flip side though, the servers required to host e-commerce platforms also contribute their own share of carbon emissions. In some cases, the power usage can be substantial enough to dwarf some industries. With electricity being the foremost contributor of carbon emissions (around 31%), data centres and servers play a part in that. However, comparing the carbon emissions of transport versus servers depends on the usage and energy sources.
B2B e-commerce also allows for the optimisation of supply chain logistics. With an e-commerce platform B2B businesses can consolidate orders and optimise delivery routes to both decrease the number of vehicles required and the distance travelled, reducing overall carbon emissions. Focus word: it can. B2B e-commerce could very well also increase the number of delivery vehicles by utilising individual shipments. It should be mentioned that an optimised system can be achieved without B2B e-commerce, but B2B e-commerce makes it easier to do so.
Traditional B2B procurement processes often involve extensive paperwork. Invoices, shipping manifests, purchase orders, packing slips etc. It’s all paper. The amount of paper waste is staggering. B2B e-commerce can eliminate this with digitisation. Digital documentation and electronic communication allows the exchange of transactions and information in a paperless manner. It saves both money and the trees.
Except… paper waste has now been replaced with electronic waste. See, paper waste is biodegradable, but electronic waste isn’t. Furthermore, unless that waste is recycled, they will continue to fill up waste centres. Perfectly usable technology can become waste the next day due to upgrades. This is something that needs to be addressed before it becomes a worse issue. Our current recycling rates surely do not match up to the wastes generated.
Improving resource efficiency
B2B e-commerce empowers businesses to optimise their resource allocation. By leveraging digital platforms, businesses can extract useful data to be used in optimising inventory management. An e-commerce platform also provides a unified platform for tracking real-time information about orders, shipping, and inventory.
B2B e-commerce platforms also provide supplier visibility. It expands a business’s reach to access a network of suppliers and manufacturers. This allows B2B businesses to be more selective in their partners and prioritise partners and suppliers who promote eco-friendliness. Again, e-commerce does not necessarily lead to these partnerships. That is a business decision. In fact, the complexities that arise from the vast array of networks that B2B e-commerce opens up can itself lead to an overall increase in carbon emissions. The existence of separate parts in a system inevitably leads to inefficiencies after all.
While B2B e-commerce offers many in terms of convenience and cost savings, it has potential to promote sustainability. As businesses embrace digital transformation, they have opened up more possibilities to care for the environment. However, if not used correctly, B2B e-commerce can be just as environmentally detrimental. As with many energy-using and energy-creating processes, our relationship with the environment and our society depends not upon the usage of such processes but the management of them to reduce the amount of waste we produce.