SCDigest Editorial Staff

The News: Wal-Mart continues its green/sustainable supply chain initiatives with the release of early data on its scorecard for the environmental friendliness of its vendors’ product packaging, as well as plans for a similar scorecard for suppliers of consumer electronics.

The Impact: When Wal-Mart sneezes, consumer goods manufacturers get a cold. Wal-Mart’s scorecards will drive major changes in how suppliers approach the green supply chain. Wal-Mart will use the packaging scorecard as an element of supplier selection starting in 2008, and plans to provide consumers information about the green-ness of electronics products in 2008 as well.

The Story: Wal-Mart shared this week early results from its Packaging Scorecard for suppliers, which it said showed “active use of the scorecard and a strong interest from product suppliers to make their packaging more sustainable.”

According to Wal-Mart, 2,268 of its vendors have logged on to the Scorecard web site so far, and 117 products have been entered into the system- numbers expected to increase dramatically. The Scorecard evaluates the “green quotient” of product packaging based a number of attributes, such as:

• Greenhouse gas emissions related to production
• Materials used
• Product to packaging ratio
• Cube utilization
• Recycled content usage
• Innovation
• The amount of renewable energy used to manufacture the packaging
• The recovery value of the raw materials and emissions related to transportation of the packaging materials.

The scorecard provides both vendor-product specific information, as well as comparisons between vendors in a category. While only “informational” for now, Wal-Mart says that “Beginning in 2008, Wal-Mart buyers will be able to use the scorecard results to influence their purchasing decisions.”

Electronics Suppliers will also be Graded

In parallel, Wal-Mart also announced plans for an similar scorecard for electronics suppliers, to be launched in 2008. The big news is probably that Wal-Mart plans to provide scorecard information to consumers, which may influence purchase decisions.

Criteria for the electronics scorecard will include:

• Energy efficiency
• Durability
• Upgradability
• End-of- life solutions
• Size of the package containing the product
• Ability to use innovative materials that reduce the amount of hazardous substances, such as lead and cadmium, contained in the product

Supply Chain Digest identified The Green Supply Chain as its number 1 supply chain trend for the start of 2007 (see Top Ten Supply Chain Trends for 2007), and that seems like a better choice every day.

We also reported last year on the full scope of Wal-Mart CEO Lee Scott’s green initiatives (see As Wal-Mart Goes Green, What’s the Impact on Suppliers?). Since then, a number of other retailers and manufacturers have also announced green initiatives.