Today's buyers shop with their head and their heart. Purchasing habits like opting for sustainable shipping options and choosing green products aren't trends anymore—they're a core focus of procurement.
"What you buy and who you buy from matters," says Chris Costello, global leader of enterprise accounts at Amazon Business. "Customers care about the sustainability commitment of the brands they do business with. Transparency in the process is key to gaining long-term customer trust and loyalty."
Technology now makes it easier for brands to earn customer loyalty as a reward for prioritizing and operationalizing the values people care about most. By adopting digital procurement tools and technologies, companies can optimize purchasing and engineer a more sustainable business for customers, employees, and the planet.
Amazon Business' network of certified suppliers, wide selection of Climate Pledge Friendly products, and digital buying capabilities are already helping organizations develop more responsible supply chains and forge deep, purpose-based connections with customers.
Buyers want sustainable products, but struggle to find the right suppliers
Sixty-nine percent of business buyers consider sustainability performance in supplier selection and contract renewals—up from 51% in 2019, according to the EcoVadis 2021 Sustainable Procurement Barometer.
A sustainable supply chain isn't only valuable to customers—it benefits the organization's bottom line as well. In fact, McKinsey & Company found that the top environmental, social, and corporate governance (ESG) performers experience faster growth, higher valuations, and reduced costs compared to competitors that lag behind in this area
While procurement leaders want to purchase environmentally responsible supplies, many experience difficulties accomplishing it through traditional buying methods and networks. In McKinsey & Co.'s 2021 survey of chief procurement officers, most respondents cited a lack of the required tools, skills, and data as the reason they haven't already incorporated ESG principles into their organization's sourcing practices.
According to Costello, supplier sprawl ranks among buyers' biggest challenges in achieving sustainability goals. "Large enterprises find themselves with hundreds if not thousands of vendors to choose from for any given product. It's difficult for buyers to identify whether a supplier is certified, uses sustainable shipping practices, or is meeting its environmental goals via the request for proposal process, legacy inventory systems, or manual search."
Is legacy procurement technology holding back your organization?
Across the board, legacy procurement technology limits how quickly and effectively you can adapt to new market trends. To meet customer expectations and internal sustainability goals, your organization must consider strategies that help buyers easily find and invest in sustainable products.
Digital procurement with Amazon Business equips buyers with convenient, consumer-like online purchasing tools that streamline purchasing and improve visibility. A few capabilities that can help you create a more sustainable supply chain include:
- Wide product selection for all needs: Amazon Business offers more than 200,000 products that are Climate Pledge Friendly and certified by any of over 30 third-party organizations (including government agencies, non-profits, and independent laboratories). Certifications that fall within the sustainability category include carbon emission impact, animal welfare practices, use of recycled materials, ethical sourcing status, and more.
With digital procurement, your organization has the option to purchase more sustainable products whether purchases are planned or needed on the spot. Long-term supplier contracts with individual suppliers aren't required to use Amazon Business. Instead, buyers can contribute to their organization's sustainability goals with each and every purchase.
"At Amazon, our sustainability efforts expand every year as we pursue our goal of producing net-zero carbon emissions by 2040," says Costello. "Recently, we launched Amazon Aware, which offers competitively-priced products made from materials like recycled polyester, organic cotton, and bio-based ingredients for customers in the U.S., Canada, and the UK. We've also introduced electric delivery vehicles to our fleet and plan to use 100% renewable energy in our operations by 2025."
- Easy search and filter capabilities: In addition to offering more access to more goods, digital procurement streamlines your purchasing processes. Costello adds, "With less time spent on manual activities, like governance, procurement leaders can spend more time creating and executing on ESG goals."
Business Prime members can leverage Guided Buying—a tool that allows procurement administrators to identify preferred products, sellers, or certification categories for all authorized buyers. Costello says, "Guided Buying empowers companies to direct spend toward any number of priorities, like Climate Pledge Friendly products. Ultimately, you get better results with better oversight, and that benefits everyone."
Procurement leaders can also use Amazon Business's application programming interfaces (API) to automate time-consuming manual tasks. For example, the Product Search API can integrate with your organization's third-party procurement software, allowing buyers to easily find and order sustainable supplies within their existing purchasing tools.
- Business analytics that improve insights: To track sustainability goals, your organization requires real-time visibility into purchasing. Machine learning technologies can analyze large amounts of data and quickly provide insights on top spending categories, total spend, buyer purchasing habits, and more.
According to Costello "Amazon Business's world-class analytics capabilities give procurement leaders the information they need to make faster, more strategic decisions. With real-time data, leaders can drive progress toward ESG goals, optimize purchasing, forecast future budgets, and develop policies to help guide buyer spending."
While two-thirds of organizations set goals for their supply chain's environmental performance, only one-third of organizations actually measure supply chain sustainability due to difficulties sourcing this information, according to Crowell & Moring LLP. Digital purchasing can help procurement teams measure their ongoing progress and provide transparency to their organizations, customers, and regulators.
The power to build a more sustainable future is at your fingertips
Each purchase made from a certified supplier helps you build a stronger, more purpose-driven business. Digital purchasing can help you not only achieve—but continuously exceed—year-over-year sustainability goals.