Sustainable warehousing

From the April 2023 print edition

A growing number of warehouses and distribution centres are posting signs showing compliance with the LEED building standard.

As Supply Professional reported in October 2022 [Smart facilities, p. 14], energy-efficient facilities are helping companies make significant gains in their quest to improve efficiency and minimize energy use.

A highly efficient facility, however, doesn’t guarantee that a warehousing operation is sustainable – there are countless ways in which warehousing practices can undo the advantages of a well-planned facility. The challenge is that every operation faces different pitfalls, and there are no magic bullets.

“When it comes to brand new buildings, we have the LEED standard, which is great,” says John McKenna, CEO of Mississauga-based 3PL McKenna Logistics Centres. “But when it comes to environmental sustainability in a broader sense, there are no standards that we can follow. So, it’s going to be incremental – there are no home runs.

To be successful, you’re going to need a lot of base hits.”

Opportunities for making incremental improvements can be found everywhere in the business. Sometimes they’re not difficult to identify. “I just got two books that I ordered from Amazon, and what surprised me was the size of the box,” says McKenna. “The books only took up a third of the cubic volume. So, you’ve got to ask – if they stuck to just the size that they needed, how many more items could they get in a truck? And how much would that reduce the cost or the carbon footprint per unit that they’re shipping? You can be sure that it would be significantly lower.”

Unused volume in an entire facility is also wasteful. “If you have a lot of inventory in a building, you don’t need as much energy to heat it or keep it cool,” says McKenna, “whereas a big empty building needs a lot of energy to heat it up. So, by using our density better, we can reduce how much energy we have to put into keeping it warm.”

The key to being on a sustainable path, says McKenna, is to avoid the temptation to be “everything to everybody” and adopt a focused business model where the needs of the customer are clearly defined. “We’re a local 3PL, and we’re very focused on the needs of our customers in the Toronto area,” says McKenna. “We stand out because we offer very high quality for the particular type of client that we have.”

Maintaining that quality often involves questioning prescribed approaches. “We discontinued our ISO 9001 certification after six years because it was distracting us from customer issues,” says McKenna. “Now we can respond to problems dynamically rather than worry about testing and approvals, and our quality has gone up. If something’s not working, we get right to the problem, test our solutions, and then adjust our processes.”

Some of the most successful interventions are equally surprising. “We had a person checking every order that went out the door, but mistakes were still getting through,” says McKenna. “So, we did the exact opposite of what people would expect – we eliminated the checker. And guess what? The errors decreased significantly. That’s because people were no longer relying on the checker to catch things, so they were more careful. Before, if a mistake went out the door,
it was nobody’s fault. Now we have accountability.”

Employee awareness is central to the incremental improvements that ultimately make an operation sustainable. “Employee suggestions are where the best ideas truly come from,” says McKenna. “For example, employees know when they can re-use boxes instead of throwing them away. That means we can buy fewer boxes and we don’t have to put as many into recycling.”

The company is currently exploring ways to encourage employees to come forward with their ideas on a regular basis. “A lot of these things might seem like they’re too small to worry about but they add up,” says McKenna, “and people look back and say, look how far we’ve come.”

Innovative technology
Automation is another strategy for making operations more sustainable. One of the keys is to target processes that consume significant time and energy.

“Cycle counting is traditionally a very slow process,” says McKenna, “so what people are doing now is flying drones among the racks and determining if there is any change in the count. This means you only have to send people there if things look different.”

Pittsburgh-based Gather AI ( is one provider for such solutions. “We are solving the problem of misplaced inventory,” says Gather AI CEO & co-founder, Sankalp Arora, “and providing real time visibility on what is sitting on the floor through the use of commercially available off-the-shelf drones.”

Gather AI’s software guides the drone through the racks, collecting photos from which barcodes and other data are extracted. That information is then compared with data in the company’s warehouse management system, and differences are reported.

The savings in time and energy with this approach are obvious – the company reports that the system can scan in eight minutes what would take two hours manually. The system also provides visual information that allows managers to utilize warehouse space more efficiently.

“A distributor using our solution told us that their forklifts are driving around the warehouse less because they now know exactly where to put pallets,” says Arora.

Perhaps the biggest advantage is that the low cost of doing drone scans enables companies, particularly those committed to SLAs, to conduct physical inventory far more frequently.

“We have customers that used to do inventory every three months, and now do it every three days,” says Arora. “That way anybody in the organization has visibility of what the levels are. So, if one facility is not doing well, they can find that out immediately instead of waiting three months, and everybody across the organization has access to that information.”

McKenna predicts that detailed information about operations will have a growing role in making warehouses more sustainable. “Overall, I think that the information we have in our warehouse management systems can have an incredible benefit to sustainability,” says McKenna. “That might include information about inventory, packaging, the effort and energy for forklifts, or anything that goes into a task.”