Unsustainable issues of sustainable manufacturers

more sustainableGood quality sustainable materials are proving to be the missing link in the sustainable chain and without solid supply, sustainable manufacturing could become unsustainable, says Richard Sederman, strategy and M&A director at Essentra Components.

Sustainability is increasingly a subject on any boardroom agenda. Collectively, the world of manufacturing and industry has been pushing, perhaps somewhat quietly, to a more sustainable future for several years, but recently that drive has taken on a new sense of urgency.

Brands across almost every major sector have been refocussing their marketing, purchasing, production and even cleaning teams to ensure they’re as sustainable as possible. But under the surface, the industry is fighting tooth and nail to meet targets set by their own internal teams or government legislation.

The challenge in some industries, however, is access to sustainable materials and we’ve hit a crossroads that’s proving difficult to bridge and that’s the issue of not enough to go around.

A good quality sustainable material, whether it’s recyclate or biodegradable resins, are proving to be the missing link in the sustainable chain and without solid supply, sustainable manufacturing could become unsustainable.

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The biggest challenge we currently face is not just quantity but also quality and consistency within the supply chain. Recently we rolled out a new LPDE range made with 40 per cent post-consumer recycled plastic. This, in itself, is an exciting step forward and while we want to get as close to 100 per cent as possible, it is difficult to guarantee such a figure can be reached and maintained. The challenge is that the volume of high-quality recyclate just isn’t reliably available in the quantities we need for us to produce a consistent product, without putting performance at risk.

Because of this, our procurement teams are vying for the attention of every supplier they can find, occasionally in competition with other manufacturers to secure enough supply to ensure our production facilities aren’t adversely impacted, and our sustainability ambitions can be realised.

In the current climate, there’s a delicate balance to be maintained and it’s beginning to cause issues for firms globally. Being too far ahead of the game may lose you customers who aren’t yet ready to make a switch; being too far behind may mean falling foul of regulators or public opinion and being in the middle is a compromise that can only be met with consistent supply.

In truth, the bottom half of the supply chain is not in a position to attain the levels that sustainable manufacturing wants to achieve and the way in which current plastic recyclers are operating is not yet efficient enough to meet the demand and it impacts the chain further up the line.

The bottom half of the supply chain is not in a position to attain the levels that sustainable manufacturing wants to achieve

Dealing with plastics directly through collections is an option but often results in the grade of product often fluctuating week on week. A new link in the chain, in the form of a consolidator and distributor, or a much-improved collection and separation plan, would enable recyclate suppliers to guarantee supply week in, week out. But whilst there is potential, there’s not yet any incentive.

The supply chain of recyclate is dominated by small suppliers either struggling with consistency from collectors or unable to meet demand. What we’re not seeing yet, although it may come over time, is large scale international suppliers plugging the gap. It’s a fragmented chain with big players struggling to find an incentive to restructure their business models, meaning traditional supply routes are ineffectual in securing sustainable materials. In reality, the bigger players should be leading the charge and knocking on doors, especially if they’re positioning themselves as responsible businesses. As of today, we’re still waiting for the knock.

The plain fact is a simple one: manufacturers want to be more sustainable, but to do so in part relies on the reliable supply of consistent, high-quality recycled materials. Unless and until such a Utopia is reached, ‘true’ sustainability cannot progress at the pace that the manufacturers, the regulators, and public opinion demands.

If we expect manufacturing to move towards a net-zero supply chain, this is an issue that must be resolved as soon as possible. Lack of supply also impacts future innovation. Global automotive brands, for example, are setting rigorous internal standards for recycled materials to be used in the manufacture of vehicle parts, sometimes up to 80 per cent as a minimum. To meet such a demand, innovation is key. What is also essential is a consistent supply chain, without which future contracts, and future sustainability targets, are equally at risk.

Richard Sederman, strategy and M&A director at Essentra Components