Big Brands and Big Retailers can do more to lead their Circular Supply Chains and enhance Circular Economies by Leveraging “Buying Power” to Purchase Large Blocks of sustainable recycled plastic raw materials. We call it “Block Sustainable Raw Material Purchasing”.
What is Block Sustainable Purchasing?
Creating a strong circular economy generally starts top down. That’s because the Top represents Demand.
Big Brands and Big Retail already consume billions of pounds of virgin plastic resins, in the form of plastic products and packaging they make and sell, much of which is polyethylene, polypropylene, polystyrene, and polyester grades.
Today the purchasing of these billions of pounds of virgin plastic resin is widely fragmented across many different manufacturers, most of whom aren’t buying in big enough blocks to leverage-down pricing or gain efficiencies. However, in a connected circular eco supply chain we change that dynamic! Remember… reducing cost and gaining efficiencies and value creation is precisely what circular sustainability is all about.
As many of us are aware, the circular economy entails many levels of the supply chain, from product and packaging design, sustainable raw material selection, recycling and waste management, technology, equipment, operational modification, brand communication and education, commitment to social purpose, and most importantly & essentially- strong consumer demand for the products we make.
For everyone involved in circular economy sustainability, we recognize it’s as much about doing good for people and planet 🌏 as it is about connecting processes, resources, technology, and information to help reduce cost, improve top line revenue, and grow stronger more “valuable” brands.
Big Brands like Proctor and Gamble, Unilever, Nike, etc. and Big Retail like Walmart, Kroger, Walgreens, etc. recognize that circular supply chain & circular economies equally impact economic and environmental performance .. and those Big companies gain competitive market & economic advantages as result. It’s why BB & BR are spending “B” Billions on sustainability.
THE GREAT DIVIDE
Big Brands and Big Retail at the Top of the supply chain have deep wells of financial and people resources to invest heavily in circular supply chain sustainability. Our GearedforGreen team is actively involved helping support many of these BB – BR circular economy initiatives in multiple areas throughout their supply chains, so we see this GREAT DIVIDE with first hand knowledge. Big Brands and Big Retail have Big Advantages.
On the other side of the Great Divide resides the bottom-up Supply Chain, where the rubber meets the green road! That’s where the bulk of the manufacturers live. That’s where all the great innovative mom and pop supply chain and services providers live. And that’s where tough decisions are made everyday, decisions between (1) staffing up or paying up to add sustainability expertise or playing it more conservative ensuring you make payroll, (2) investing in sustainable technology or preserving cash for tomorrow, (3) investing in resources to measure consumer trends and carbon footprints 👣 or keeping status quo and not rocking the boat, or (4) paying more $$$ for sustainable recycle ♻️ grade raw materials versus paying less for prime grade virgin plastic resins.
Here’s Why Block Sustainable Purchasing Benefits “Everyone” in the supply chain
Unlike the Big Guys, the bottom up
Supply Chain juggles these many challenges that impact Investment, Risk, Credit, Leverage, etc., all of which must be managed incredibly skillfully to survive.
More challenges + more risk = less sustainability.
By participating in Block Sustainable Raw Material Purchases, BB & BR help smooth out the sustainable raw material landscape from bottom up, making it easier and more cost effective to widely access sustainable raw materials. That access to leveraged pricing and supply efficiency has widely positive effects on the entire supply chain, creating advantages up & down.
Here’s (3) Key Benefits to everyone in the supply chain as a result of Block Raw Material Sustainable Purchasing
- Leveraging purchasing power shares cost savings top to bottom
- De-Risking raw material suppliers makes it easier for them to invest in improvements
- Connecting the supply chain top to bottom creates even more block buying, collaboration & innovation which strengthens the entire supply chain.
> their are many more powerful circular supply chain benefits to Block Sustainable Purchasing – learn about them at www.gearedforgreencirculareconomy.com
Here’s (3) Key Strategies to make Block Sustainable Raw Material Purchasing Successful
Big Brands and Big Retail are the biggest consumers and distributors of plastic products and plastic packaging. BB & BR Drive Demand. Strategic raw material purchasing not only benefits manufacturing, BB & BR, it also benefits raw material suppliers too.
- Locking in large volume annual commitments via block purchases can be accomplished without locking in price or even paying for materials until deliveries are complete
- Buying large volume annual blocks of sustainable raw material can be done without establishing specific grades or material specifications.
- Implementing Block Supply Finance Arrangements between BB/BR, participating Supply Chain Manufacturers, and Raw Material Suppliers enables the entire supply chain to share savings.
> their are many additional circular supply chain strategies to Block Sustainable Purchasing that we can help implement to secure additional supply chain materials, products & services – learn about them at [email protected].
To learn more about steps you can take to become a sustainable brand, contact