Logistics and Transport
Reducing our emissions is an important goal within our transport and logistics concepts.
- Overall, we want to reduce the emissions from transporting our products by five percent per ton of product by 2020 (compared to the base year 2015). At the end of 2019, we had already achieved this target by reducing transport-related emissions by 7 percent per ton of product compared to the base year 2015.
- We continue to focus on expanding intermodal transport, improving our warehouse network and optimizing transportation.
- Close collaboration with our suppliers and customers plays a key role.
- We also optimize our products and packaging in terms of weight and volume, provided this is possible without compromising their performance, convenience and stability.
- Further, when choosing our transport partners, we take efficiency as well as environmental and safety performance into account.
- Company-wide IT-solutions enable us to systematically record the CO2 emissions of our logistics operations and to handle our transport planning and execution more efficiently across all business units and countries.
- Optimizing our logistics footprint
- Expansion of intermodal transport
- Warehouse footprint optimization
- Continuous transportation optimization
- Digital tools for improved logistics
- Alternative mobility solutions
Optimizing our logistics footprint starts in the product development stage. We work on product and packaging optimization in terms of weight and volume, provided this is possible without compromising their performance, convenience and stability. More concentrated products and lighter packaging reduce transport weight, and thus decrease carbon emissions.
Alongside product and packaging optimization, improving our logistics structures helps us to reduce transport emissions. This includes optimizing the location of our production sites: For bulkier products, we reduce transport distances and environmental impact by operating regional production sites. Compact products place fewer demands on transport. Therefore, we leverage efficiencies in production by manufacturing these products centrally whenever possible. For the transportation of finished goods, we focus our efforts on three major drivers:
- Expansion of intermodal transport
- Improving our warehouse network
- Continuous transport optimization
We leverage these drivers by collaborating with our suppliers and customers to implement joint logistics projects. When choosing our transport partners, we take efficiency as well as environmental and safety performance into account. Relevant criteria are included in our tendering process for the purchase of logistics services. These include energy-saving targets and measures for modernizing vehicle fleets.
Intermodal transport involves using more than one mode of transportation. At Henkel, this means that more and more transport is being switched from road to rail: A truck carries the goods to the nearest rail loading terminal. From there, the goods cover longer distances by train, before a second truck collects the goods at the destination terminal and delivers them to the recipient. This allows us to make use of the lower CO2 footprint of rail transport compared to road transport: a train emits about one-third of the CO2 of a truck, when transporting the same weight of goods. Intermodal transportation has therefore become a key driver for CO2 reduction in logistics at Henkel. To leverage intermodal solutions in the future, we have begun systematically testing the applicability of intermodal transportation to all relevant routes across Henkel.
The location of our warehouses and distribution centers is selected to minimize the distance between our production sites and our customers. We also achieve synergies by consolidating transport between individual plants and warehouses. Further, we make use of the “mega warehouse” concept, where a small group of main distribution centers store products until the required quantities are due for on-time delivery to regional warehouses and retailers.
We continuously increase the capacity utilization of our cargo containers by expanding our pooling activities. This includes the targeted consolidation of the transport and storage of similar product categories within Henkel, as well as combining transport with other manufacturers who share the same logistics service provider. The resulting synergies in storage, consignment and transportation ensure that more fully-loaded trucks travel to our customers’ central warehouses. We also hire pallets instead of buying them, which results in more efficient pallet collection and improves the handling of damaged pallets. Where possible, we also make use of reusable cardboard pallets instead of wooden pallets. Due to their lighter weight, they are easier to handle and reduce fuel consumption.
With the help of a Group-wide IT solution, we can systematically record the CO2 emissions of our logistics operations and handle our transport planning and execution more efficiently across all business units and countries. In particular, higher truck capacity utilization and optimized routes play a key role in decreasing transport distances, reducing fuel consumption and thus cutting CO2 emissions.
We use a digital tool, which monitors our progress by calculating carbon emissions from all transport modes used to transport finished goods on the basis of the DIN EN 16258 standard. Real distances based on GPS data and country-specific emission factors, as well as data relating to each carrier, are used as input. This enables us to foster transparency and data comparability across the entire industry, and helps us to track progress toward our emissions reduction target.
In addition to deploying advanced digital tools, the utilization of alternative mobility solutions is also part of our approach to optimizing our transport and logistics. At our headquarters in Düsseldorf, we incorporate electric vehicles into the internal fleet to replace conventional vehicles with internal combustion engines since 2012.
While using electric vehicles is one approach, we also strive to integrate further alternatives into our business operations. In 2019, the first hydrogen-powered car was added to Henkel’s internal fleet at our plant in Düsseldorf.
The deployment of conventional combustion engines that run on Compressed Natural Gas (CNG), which is mainly composed of methane, are another innovative alternative mobility solution that is being implemented into our business operations. This produces the least amount of CO2 of all types of fossil fuel combustion.