Green supply chain in the food sector: the case of india

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All these evolutions put some dynamic pressure on the performance of the agro alimentary system, causing a reorientation of the companies with regard to their roles, their activities and their strategies, in the developed countries as much as in the developing countries.

SUPPLY CHAIN, NETWORKS AND LOGISTICS

CONCEPT OF SUPPLY CHAIN

The concept of supply chain defines the sequence (decision makings and execution) of processes (products, information and money) and flows aiming at fulfilling the final requirements of the customers, that take place in and between the various stages of this continuum, from production to final consumption.

Supply chains understand not only the producer and his suppliers, but also logistic flows, carriers, warehouses, retailers and consumers. In a more general way, the production lines include new products development, marketing, operations, distribution, finance and services to the customers.

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Source: “Majors and Minors in Supply Chain Operations Management”, Concordia University, 2015

A traditional design of the supply chain is the “cycle”. According to this point of view, the supply chain processes are divided into a series of cycles which all take place between two successive stages. Each cycle is uncoupled from the other cycles thanks to an inventory, so that it can function independently, in order to optimize its own process and not be blocked by other cycles “problems”.

SPECIFIC CHARACTERISTICS OF THE FOOD PRODUCTION NETWORKS

An agro alimentary system includes organizations responsible for the production and distribution of products with vegetable or animal nature. In general, two principal cases are distinguished. The first one is the agro alimentary chains of fresh agricultural products (like fresh vegetables, flowers, fruits). Generally, these chains include farmers, biddings, wholesalers, importers and exporters, retailers and specialized stores like their suppliers of inputs and services. Basically, all these stages do not influence the intrinsic characteristics of the cultivated or intact product. The principal processes are: handling, storage of treated products, packing, transportation and most of all, trading of these goods.

The second one is the agro alimentary chains of treated food substances (such as pieced meats, snack bars, fruit juices, desserts, canned food substances). In these chains, the agricultural products are used as raw materials in order to produce consumer goods with a higher added-value. In most cases, the processes of conservation and treatment lengthen the products conservation.

The participants of the two types of chains, such as farmers, tradesmen, processors, retailers, etc. know that original products with high quality can be deteriorated with the inappropriate action of another participant.

LOGISTICS

Logistics is part of the supply chain process and makes it possible to plan, implement and to control the effective flow of the storage of the goods and services and of the information which relates to them, from their origin to consumption, in order to fulfill the requirements of the consumers and to meet the requirements imposed by other agents such as governments (new rules and regulations, like the general law on food) and communities of retailers (e.g. the world Initiative on public health).

Historically, logistics were not a priority within the organization, but only one of the components of the cost of the product. Nowadays, it is considered that logistics is an adding value process that directly supports the principal goal of the organization: to be competitive in terms of high quality of the service to the customers.

Logistics also make it possible to obtain competitive prices and quality and to comply with the rules and regulations, in order to meet the vast requirements with the consumers and the other agents in terms of quality of service and information of the supply chain. Finally, logistics help answering with flexibility to the market requests.

GREEN SUPPLY CHAIN AND BENEFITS

Recently, the supply chain management has begun to take into account the environmental issues linked to the overall activity of the firms, which incorporate major innovations that will soon become essential for the smooth running of their business. Beyond the usual key criteria (availability of the products in the shops, costs cutting, financial performance), today more and more companies take into account new parameters such as CO2 emissions and energy consumption reductions.

While the strategic decisions used to be made with preoccupations such as cost reduction and service level improvement, from now on they also take into account the reduction of waste and pollution. Many companies already launched out what is called “green supply chains”.

A green supply chain is defined as being an approach aiming at reducing the environmental impact of a product throughout its life cycle.

GREEN SUPPLY CHAIN

The Green Supply Chain is an approach aiming at minimizing the ecological print of a product, throughout its life cycle. The analysis of life cycle (ACV) of the product results in conceiving the product in a way by which it has the most reduced ecological print possible, during the following phases:

- manufacturing, use by the final customer and recycling;

- during all the logistic phases (packing, transport, storage) which connect the actors of the upstream towards the downstream (from the raw materials until the distribution with the ultimate consumer);

- recovery of packing (containers, pallets, paperboards, and others) between the various actors of the supply chain of the upstream towards the downstream;

- logistics of support (consumable necessary to the use of the product) or of after-sales service and returns under warranty to the customer (distribution reverses);

- recovery and recycling of the product at the end of the lifetime for a reassignment in all of its components in the upstream chain of production.

The general idea about green supply chains often tends to associate the term with road transportation. However, ecological innovation can apply to every step of the supply chain, from production to distribution. In comparison with Supply Chain green, the life cycle of a product