Transport & distribution

Our approach

We sell around 400 brands in more than 180 countries. For every sale, there have been multiple journeys – to and from our factory – which generate a corresponding impact in terms of greenhouse gas emissions.

We are working to minimise greenhouse gas emissions from transport and distribution by reducing mileage, using lower-emission vehicles and selecting alternative forms of transport. Reducing our environmental impact also helps us achieve cost-effective and efficient distribution of our products.

Our logistics network

Although in most markets we do not own or operate any distribution vehicles ourselves, we estimate that globally, our transport and distribution systems emit a similar proportion of CO₂ to our manufacturing operations.

We spend a significant amount every year on transportation and warehousing from suppliers’ factories to our own factories, from our factories to our distribution centres and from there to our customers. We are working to reduce the CO₂ emissions from energy used during these operations.

Our targets

We are committed to tackling our CO₂ emissions from transport and as part of the Unilever Sustainable Living Plan we have set the following target:

• By 2020 CO₂ emissions from our global logistics network will be at or below 2010 levels despite significantly higher volumes.

In overall relative terms, this will represent a 40% improvement in CO₂ efficiency. We will achieve this by reducing truck mileage; using lower-emission vehicles; employing alternative forms of transport such as rail or ship; and improving the energy efficiency of our warehouses. The scope of this commitment includes transportation of products from our factories and warehousing dedicated to Unilever products alone. At this stage we have not included the raw materials coming into our factories, multi-user warehousing, or air freight.

We have recently developed key performance indicators (KPIs) to track our performance. In 2011 we will be gathering the data and setting up the systems to enable us to measure and report against the KPIs. A key measure we will use to track our progress towards our 2020 goal is the absolute tonnes of CO₂ emitted per year from energy used in transport and warehousing. We will also make use of KPIs to track our CO₂ efficiency in transport and warehousing, which will help us to measure our progress and make decisions.

How are we going to achieve our targets?

We have identified a number of areas for greenhouse gas reduction that we will implement across our global operations to achieve our target.

• Improving the ‘loadfill’ of vehicles – We aim to maximise how much product we load onto our trucks. For deliveries of tea from our factory in Brussels to a warehouse in France, a change in vehicle type has allowed us to increase the number of pallets we can load into the vehicle. This initiative saves us almost 10% CO₂ per annum. See the Institute of Grocery Distribution case study in Related links for more. In Australia we make use of a consolidation warehouse near our factory, which allows us to fill our vehicles more efficiently. This saves 7% CO₂ emissions per 400 km trip. In Mexico, we collaborated with Walmart to improve loadfill, resulting in annual savings of 208 tonnes of CO₂ emissions and a 56% reduction in pallets.
• Switching transport modes – We have switched to more CO₂ efficient modes of transport, for example road transport emits over four times the amount of CO₂ emissions per tonne per km than rail. We now send products from our factory in Nyírbátor in Hungary to the Netherlands, UK and Belgium via a mix of road and rail. We use the return journey of a train used by other manufacturers. This collaborative approach saves 1,069 tonnes of CO₂ per annum.
• Improving the energy efficiency of warehouses – In Europe, we have reduced the CO₂ emissions from our key warehouses by more than 10% from 2009 to 2010. This has been achieved through a number of initiatives such as raising awareness among staff, improving lighting controls and using cleaner sources of energy. One of our warehouses in Turkey replaced diesel oil with natural gas, which resulted in a 3% reduction in CO₂ emissions per annum.
• Consolidating the warehouse network – In France we reduced our annual kilometres travelled by 18% by designing and building a warehouse which combines deliveries of our food and home and personal care products to our customers. In the past these were stored and delivered separately.
• Influencing policy, legislation and investment – Development of CO₂ efficient infrastructure will be integral to the delivery of our target. We are key players in discussions with the Dutch Ministry of Transport, Public Works and Water Management and the European Commission on the development of freight rail corridors into a European rail network.
• Factoring CO₂ emissions into procurement decisions and the design of new supply chain networks – We are working with our procurement function to consider the CO₂ emissions when we buy freight. In addition, we will consider CO₂ impacts across the lifecycle of our products when deciding where to locate our warehouses and sourcing units.
• Collaborating with others – We are working with others to reduce our impacts. For example, we share warehouse space in the Netherlands with Kimberly-Clark.

Our progress

2011 will be the first year of measuring and reporting our progress against our KPIs.

However, some regions have already been working to reduce CO₂ emissions for a number of years. In April 2008 we launched our own internal transport management organisation, UltraLogistik, which manages more than 35,000 transport movements across Europe per month. UltraLogistik finds the most efficient ways to move raw materials and packaging to our factories and then transport finished goods to around 300 warehouses across Europe.

As a result, in 2009, we moved around 19% of European freight to: off-road networks such as rail, sea and inland waterways, and this was further increased during 2010.

Unilever is a key player in the haulage element of a UK industry initiative to reduce transport impacts – the Sustainable Distribution Group of the Efficient Consumer Response (ECR). By the end of 2009, through the sharing of vehicles and implementing more efficient warehousing, the initiative had saved 124 million miles of travel, equivalent to removing 2,000 lorries from the UK’s roads.

External recognition

In 2011, Unilever received the Contribution to Environmental Improvement award at the annual European Supply Chain Excellence Awards. The awards recognise and reward organisations in Europe that demonstrate excellence in their supply chain operations. Judges were impressed by our achievements in reducing the carbon footprint of our logistics operations through more efficient use of vehicles, using an optimal vehicle load fill solution, and energy saving initiatives at our warehouse network (delivering a 33% improvement in absolute CO₂ emissions from 2008 to 2010).