Weekly Roundup - Bangladesh’s Political Instability, Aldi Nord’s New Logistics Center and Mercedes’ Fight Against Counterfeit Parts

Retailers encounter significant hurdles in reducing Scope 3 emissions, which include indirect greenhouse gas emissions generated throughout their entire value chain, from sourcing materials to the consumer use of products. These emissions are particularly challenging to manage due to the complexity of retailers' supply chains, which are vast, fragmented, and span multiple sectors, involving various stakeholders such as suppliers, distributors, and consumers. Reducing these emissions requires coordinated efforts across the entire value chain, making it difficult for retailers to achieve meaningful reductions independently.

To address these challenges, retailers are implementing a variety of decarbonization strategies. These include improving energy efficiency, transitioning to renewable energy sources, adopting sustainable agricultural practices, and encouraging changes in consumer behavior. Retailers are also focusing on collaborating with suppliers to reduce waste and improve manufacturing processes. Some decarbonization efforts, like shifting power grids to renewable energy, depend on broader public and private sector collaboration and may take longer to achieve. However, many solutions are within reach and can be cost-effective or even cost-saving. The McKinsey’s report identifies seven strategic themes for reducing Scope 3 emissions, emphasizing that the scale and complexity of these efforts vary. Retailers' roles can range from leading initiatives to collaborating with partners or advocating for broader systemic changes. Achieving a 15 percent reduction in Scope 3 emissions by 2030 is feasible using existing technologies, with potential for even greater reductions through innovation.

The ongoing political unrest in Bangladesh, marked by violence and the recent resignation of Prime Minister Sheikh Hasina, is threatening to disrupt the country's vital clothing industry. This could have significant repercussions for global apparel retailers, including H&M, Zara, Uniqlo, Primark, and others, as they enter the crucial holiday season. Bangladesh, the world's third-largest clothing exporter, has already lost four days of production due to factory shutdowns and curfews. The readymade garment industry, which contributes 83% of the country’s export earnings, could face substantial losses, though the exact impact remains unclear. Major international retailers source significant portions of their products from Bangladesh, and the instability could affect their supply chains and business operations.

Aldi Nord will officially open a new logistics center in Lehrte-Aligse on August 26, 2024, replacing its outdated facility in Lehrte-Sievershausen. The new center, which covers approximately 42,500 square meters, features modern energy and ecological standards, including a green roof and photovoltaic systems, and provides updated office spaces and a 3,800 square meter cold storage area for fruits and vegetables. From September 9, 2024, the center will begin supplying 77 Aldi markets in Lower Saxony, with an additional 57 markets being added in January 2025. The move aims to support Aldi's future growth and sustainability goals while ensuring minimal impact on the 1,500 employees, most of whom live nearby. The relocation will eventually lead to the employment of around 100 additional staff due to the consolidation of neighboring regional companies.

The trade in counterfeit car parts, such as alloy wheels, airbags, and brake components, is on the rise, prompting car manufacturers like Mercedes-Benz to take increased action against counterfeiters. Last year, over 1.6 million fake Mercedes products were seized, with customs and law enforcement agencies conducting around 740 raids, a 20% increase from 2022. Despite this, the number of counterfeit items seized remained consistent with previous years. Mercedes-Benz is particularly focused on removing counterfeit safety-related parts, which pose serious risks to road users. These parts, including brake components and steering parts, are destroyed to prevent accidents. The company's anti-counterfeiting efforts involve extensive investigations and collaboration with authorities. Renata Jungo Brüngger, a Mercedes-Benz executive, emphasized that the counterfeiting industry operates like organized crime, threatening road safety, environmental standards, and fair labor practices.

Read more on recent highlights

• US retailers rush holiday imports, fearing strikes and disruptions
• Cyberattacks & NIS2: How companies effectively protect supply chains
• Boeing’s new CEO moves to factory heartland to stem safety crisis
• High transport costs from the Far East are causing problems for importers
• Hyundai to invest $28 million in Thailand for EV assembly, batteries
• US avocado demand drives mass deforestation in Mexico
• Tailor-made storage technology for pineapple e-commerce
• How to manage seasonal demand when everyone is out of office
• Willingness to pay for sustainable packaging is decreasing

Dive deep into research

"Quantum-inspired computing technology in operations and logistics management" by Núñez-Merino, M., Maqueira-Marín, J.M., Moyano-Fuentes, J. and Castaño-Moraga, C.A. (2024)

"Review of metrics to assess resilience capacities and actions for supply chain resilience" by Bruckler, M., Wietschel, L., Messmann, L., Thorenz, A. and Tuma, A. (2024)

Events

Net-Zero Supply Chain

When: 12. - 13. September 2024

Where: Amsterdam, Netherlands

What:Join us as we delve into crucial topics such as sustainability in supply chains, decarbonization metrics, innovative warehousing and logistics solutions, and advancements in green transportation. Discover best practices in integrating renewable energy, implementing carbon offsetting schemes, managing Scope 3 emissions, and leveraging AI for carbon footprint reduction.

Rethink! Smart SCM

When: 29. September - 01. October 2024

Where: Berlin, Germany

What: Rethink! Smart SCM is the strategy event for supply chain & logistics managers to interactively discuss current projects, the latest developments, innovative technologies and trends in supply chain management and logistics in the Industry 4.0 environment. Meet 100+ executives from the supply chain & logistics sector from leading European companies on one platform over 2½ days - join now!

Automotive Logistics & Supply Chain Digital Strategies Europe Conference

When: 3. - 4. December 2024

Where: Munich, Germany

What: As digital, IT, supply chain, and logistics expertise converge, this conference offers a significant opportunity for stakeholders in the European automotive supply chain sector to share knowledge and find tailored solutions. Learn how manufacturers and tech leaders are achieving new levels of supply chain visibility and planning through digital control towers and advanced logistics systems. Understand the practical applications of generative AI, digital twins, cloud-based ERP, and AR/VR in your supply chain planning and execution.