Sustainable supply chains in Africa: Why is it beneficial?

Sustainable supply chains in Africa have garnered very little attention. However, it is an essential component of business operations around the globe. The reason for the poor acceptance is the lack of promotion, even though there are many opportunities for sustainable development.

 

Introduction

The concept of sustainable supply chains is not well accepted on the continent. This lack of popularity is because it is perceived as too expensive and not worth the initial capital. Another reason the idea is rejected is a lack of education on its general benefits. For example, how a network of sustainable supply chains benefits the continent.

This article reviews some of the benefits and challenges of promoting sustainable supply chains in Africa while addressing some of the issues surrounding their implementation.

 

 

What are the benefits of promoting sustainable supply chains in Africa?

Sustainable supply chains have been tried with great success across the globe. Fortunately, it has achieved tremendous success. Here are some of the benefits of applying them in Africa.

 

Cost reduction of the supply chain

Businesses and supply chain managers constantly look for ways to guarantee profits and tend to look to the supply chain to help.

Most supply chain managers worldwide live to reduce the cost of their supply chains. It is the same in Africa.

Implementing or investing indeed requires some capital. However, it is a cost-reduction strategy that Business owners should welcome.

Although the initial capital (cash resources and human resources) in setting up a sustainable supply chain can be quite a lot, it is one of those investments that pays for itself in the long term.

Sustainable supply chains can cut costs by implementing strategies that increase efficiency and reduce waste. These strategies include adopting lean principles, optimizing supply chain operations, diversifying people and ideas, investing in technology, and transitioning to renewable energies.

The strategies will generally help keep costs low and help businesses on the continent become more efficient.

 

Risk mitigation of the supply chain

By embracing sustainable supply chains, Business owners and supply chain managers can reduce their supply chains’ exposure to risk that could very well lead to disruptions in the supply chain.

Examples of such supply chain risks include climate change, environmental pollution and human rights violations which have plagued many communities on the continent.

Although these risks are terrible to our environmental and social well-being, human lives are also at stake. Companies like Shell and Mobil have been forced to pay heavy fines for environmental pollution.

Failing to avoid these risks usually has profound impacts on the supply chains, such as negative brand reputation, supply chain disruptions, and financial losses.

 

Increased innovation within the supply chain

Technology is one of the chief drivers of innovation and a key component of any sustainable supply chain.

Pushing for sustainable supply chains across Africa can drive innovation by encouraging companies to adopt tech-driven solutions that can help improve efficiencies. 

These solutions allow the supply chain managers to improve efficiency in the supply chain while allowing them to develop new products or services. They can also increase competitiveness and improve business outcomes.

 

Growth opportunities for businesses and supply chains

With sustainable supply chains being a global issue, international organizations across the sea take it seriously. And are interested in companies with supply chain sustainability frameworks.

Partnering with such companies allows them to stick to their sustainability commitments. For African companies, this means an opportunity to work with big businesses and corporations to expand their clientele.

 

Challenges of promoting sustainable supply chains in Africa

While supply chain sustainability is becoming increasingly important globally, promoting and enforcing it in Africa has several challenges.

 

Lack of transparency in supply chains

One of the major challenges in achieving a sustainable supply chain on the continent is the lack of transparency in supply chains. Many African companies struggle to track and trace their supply chain effectively, making identifying environmental and social risks and opportunities difficult. 

The lack of transparency in the supply chain processes makes it challenging to implement or communicate good sustainable strategies for the supply chain.

 

Limited capital available to businesses or the supply chain

Implementing sustainable supply chains requires a significant initial investment from businesses. However, not many businesses have access to the capital needed, especially small and medium-scale businesses.

The lack of capital for these businesses makes it difficult for them to invest even if they want to. They would rather invest their limited resources in their unsustainable supply chain models because it is safe for their business.

 

The complexity of supply chains in the continent

Supply chains are complex enough because of the various processes intertwined together. In Africa, poor government policies and Infrastructures have only contributed to the complexity and difficulty of the supply chains.

For instance, businesses build informal relationships with suppliers to get ahead of the competition and difficult government policies. This sort of relationship often causes a lack of accountability on both ends, resulting in many delays and disruptions.

Poor access to different intermodal transportation systems also contributes to logistics challenges forcing businesses to rely on unsustainable means because it saves more cost for them.

These complexities can make identifying and addressing environmental and social risks, such as deforestation and labour exploitation, challenging.

 

Lack of collaboration among all stakeholders of the supply chain

Collaboration is essential for achieving supply chain sustainability, but getting all stakeholders on board can be challenging. 

In Africa, consumers do not prioritize sustainability because they are unwilling to pay the premium. This makes it difficult for companies to take it seriously. Governments are shying away from policy and infrastructural responsibilities, so they shy away from enforcing sustainability practices.

Business owners want to get rich quickly to escape certain conditions. Their lack of interest in parting with the huge capital needed for sustainable supply chains is understandable.

When most stakeholders in the supply chains are not buying the idea, promoting a sustainable supply chain can be difficult.

 

Conclusion

Achieving supply chain sustainability in Africa is a complex and challenging process that requires significant effort and investment from companies. Despite these challenges, companies prioritizing supply chain sustainability can gain a competitive advantage, positive brand reputation, and meet growing expectations.