Forrester Study: How To Transform Product Sustainability Into Performance Initiatives

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How increasing your carbon footprint reporting can drive sales – and profits 

Increasing your carbon footprint reporting isn’t just a regulatory obligation. It can also make a significant impact on your bottom line.

Makersite and Forrester’s collaborative thought leadership paper has, at its heart, a simple objective: to redefine how businesses approach sustainability. 

Makersite commissioned Forrester to evaluate the state and impact of sustainability in product lifecycle management in the manufacturing industry. In order to do so, they surveyed 493 organizations, liaising directly with product design and sourcing decision-makers in manufacturing to build the fullest possible picture of the opportunities – and challenges – that lie ahead. 

In a series of blog posts designed to compartmentalize the report, we’re taking a deeper look at 5 of the key takeaways for manufacturing businesses based on the research. 

You can read part one in the series here. For this instalment, we’ll outline why increasing the carbon footprint reporting of your products will be a key driver for sales and profits in your organization. 

Sustainability, without doubt, remains a critical business issue. Whether from a regulatory, reputational or financial perspective, an organization with its house in order is better primed for success. For some, sustainability and the regulations surrounding its proper implementation have been seen as little more than a fad. A box to tick in order to satisfy stakeholders and regulators. But now we have irrefutable evidence that better and more complete carbon footprint reporting serves as an essential catalyst for supporting – and driving – sales.  

Within the manufacturing industry, key decision makers in product design and sourcing are taking action to balance sustainability, resilience, and top and bottom-line improvements. There is a growing realization that manufacturers must become quicker, smarter, and more sustainable to survive. They can leverage material, component, and supplier intelligence to improve data visibility, to guide better design and sourcing decisions. With a stronger foundation and a more granular approach, carbon footprint reporting is no longer such a burden. 

Why do organizations need to do this? 

When it comes to carbon footprint reporting, now is not the time to stand still. Good intentions will get you nowhere. In a competitive marketplace, meeting reporting obligations is an absolute minimum. Moreover, companies who neglect to accelerate their carbon footprint reporting will find themselves rapidly losing their share of the market to those who have been more agile and innovative in their approach. Efficiency and data granularity are key. Without a solution that ticks both boxes, you will very quickly find yourself losing position to a competitor who is able to move faster than you. And once you’ve fallen behind, it becomes twice as hard to get back. 

Similarly, a more proactive approach to carbon footprint reporting will leave you poised for greater success going forward. Better product reporting can open your organization up to new markets and new audiences, which in turn will increase sales and profitability. It will also likely open up new territories where, previously, different reporting obligations may have meant that prior attempts at entry into that marketplace were stymied. The potential is enormous. You don’t have to make new products to access new markets and new customer segments – you simply have to report better, and report faster. 

As the Forrester paper notes, manufacturers with a more mature approach to their carbon footprint reporting – those who sought out and actively implemented a solution designed to enhance previous practices – are likely to see greater success. Those who integrate a material, component, and supplier intelligence solution into their PLM practices expect to see high gains across a number of important KPIs. Most prominently, manufacturers equipped with the right solution saw a 25% improvement in win rate, with 26% also identifying the opportunity to command a greater price premium. 

The hypothesis speaks for itself: manufacturers that integrate PLM processes with material, component, and supplier intelligence will enjoy time to market advantage over less mature competitors and have the opportunity to scale their scarce design and supply chain expertise over a wider range of product variants. 

How can Makersite help? 

Transparency is central to accurate, detailed carbon footprint reporting. With Makersite, organizations are able to rely on deep-tier, up-to-date and consistent data that allows them to demonstrate their decarbonization strategy in absolute detail. 

Depending on the nature of the product being manufactured, reporting across numerous product groups can be a painstaking task – particularly if it’s being done manually. However, with Makersite’s AI-driven solution, organizations can use product and supply chain data – sourced from the largest product and supply chain database with 36,000+ industrial processes, 600,000+ environmental impacts, and 100,000+ materials – to automate reporting across all products groups. 

Additionally, Makersite’s dedicated eco-design dashboard allows users to make data-driven product optimization decisions across sustainability, costing, risk and compliance. With some 80% of ecological impacts occurring in the design stage of a product, full oversight is critical when it comes to achieving sustainable design goals and hitting reporting parameters.  

Users simply have to upload their BOM and, once uploaded, they will receive automated, AI-driven recommendations for switching out key product components, in turn optimizing carbon footprint while lowering costs, giving them the depth of knowledge they need to make crucial design decisions at the click of a button. 

At Makersite, several of our key clients have experienced this revolutionary approach to optimizing carbon footprint reporting first-hand. 

Belgian technology giant Barco faced challenges in efficiently reporting SKU-level environmental data due to data being siloed and scattered across the supply chain, resulting in slow and costly manual efforts.  

To solve the problem, Makersite provided Barco with automated Life Cycle Analysis (LCA) and Product Environmental Footprints (PEFs) at the SKU level, allowing them to accurately offset their emissions, comply with EU taxonomy reporting requirements, and implement more targeted eco-design principles across their product portfolio 

By doing so, Barco were able to consolidate and enrich their data, perform comprehensive environmental reporting, and make data-driven decisions to minimize their environmental impact while lowering costs. 

Automating their LCAs allows Barco to accurately offset their emissions and further promote their climate-neutral ambitions, as well as strengthen communication on sustainability with external stakeholders – all based on data. 

In a similar vein, the cosmetics pioneer Lush wanted to double down on their already impressive sustainability and carbon footprint reporting credentials. As a company, Lush are closely aligned with and well-known for their commitment to sustainable processes. Customers and stakeholders alike expect them to lead from the front. Falling behind would not only have an impact reputationally, but financially too. 

The team at Lush felt they were not doing enough to measure supply chain impacts from an environmental point of view. They lacked visibility around carbon emissions produced as a result of their supply chain activity, and needed more detailed insight into where the problems lay. They lacked harmonized, integrated data, which hampered their ability to plan and hit their target of being “carbon neutral, climate positive” by 2030. 

Makersite’s integrated data software provided the solution Lush were looking for. With relevant data on supply chains typically siloed away in different databases, Makersite’s ability to bring together the 3,000 ingredients the company purchased worldwide in one platform made a big difference, giving them “all of the emission factors and LCA databases at our fingertips.” Lush were able to analyze various impacts at a much deeper, more granular level, and had all of their choices laid out directly and simply in front of them, allowing them to make sense of complex data and measure it more easily. 

Makersite’s modelling capabilities gave Lush significantly deeper insight into their supply chain data. From energy sources to waste management, a better understanding of how their supply chain operated gave Lush the ability to go back to suppliers and suggest changes in order to help them achieve their goals. The company now has an automated and scalable way to manage and understand their supply chain in greater detail, giving them the speed, scale and granularity that they were seeking and a much better chance of hitting their ambitious 2030 targets. 

Lush are preparing to release their first TCFD report based on modelling powered by Makersite. Their supply chain makes up 42% of their total emissions – by far the biggest impact in their business. With Makersite they’ve been able to assess the impact of more than 3,000 materials this year, including remodelling FY21 materials based on better data that more closely reflects the practices in the suppliers they buy from. Doing so has shown that Lush have reduced their carbon impact by 25% against emissions in 2021 – and all because of increased data accuracy and improved granularity provided by Makersite’s software. 

Being smarter with data – and being able to accurately measure it – not only allowed Lush to see where they needed to do work, but also gave them the platform to increase their transparency efforts and advance their goals. 

Ultimately, as a result of using Makersite’s solution, both companies were able to use more detailed, more granular product and supply chain data to not only automate their carbon footprint reporting, but to position their organizations as pioneers in their industry, giving them a distinct advantage in markets both old and new. 

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