Procurement and Supply Chain - Oakdene Hollins

WR1403: Business Waste Prevention Evidence Review
L2m4-3: Procurement & Supply Chain
The 2010 SDRN report identifies “lack of knowledge of sustainable technologies, lack of project
management, lack of appropriate procurement systems, lack of market, lack of political will and focus on
short term profitability” as barriers to sustainable construction procurement (5 p. 8). The research also
reveals that more generally procurement professionals in the private sector can be disconnected from
the strategic direction of their organisation: “There is an issue around how procurement is valued within
firms and as a profession, and UK practitioners were found to rate themselves particularly low” (5 p. 9).
Lack of power to effect change in the supply chain or to find sustainable products/services
The main barrier is the fact that not all purchasers have the power to source – or cause to be developed –
waste-efficient products and services. While large corporations or public sector bodies wield
considerable procurement influence, smaller businesses do not (17 p. 14). This explains why delivery
bodies devote their efforts to changing the behaviour of leading blue chip companies (e.g. WRAP’s
Courtauld Commitment, Envirowise’s Supply Chain Partnership Forum).
Examples of a lack of purchaser power include:
Kingspan Insulation, having adopted BRE’s Environmental and Sustainability Standard (BES) 6001:
Framework Standard for Responsible Sourcing of Construction Products, found that although one
larger supplier offered “nice warm words” the latter failed to change their behaviour, as Kingspan
had little apparent power in the market. Kingspan solved the problem by ‘changing its language’, by
couching it in terms that the supplier would understand: “The ‘bottom line’ was that if suppliers
weren’t willing to change, this could lose Kingspan continuity of business and therefore the
suppliers would also lose out” (83 p. 9).
During a building project in Cardiff City Centre, the contractor was sourcing too small a quantity of
building material which “gave rise to few opportunities to influence suppliers to reduce packaging or
take it back” (84).
When Rascards, a manufacturer of plastic store cards based in the northwest of England, asked its
German supplier of PVC sheets to eliminate timber cages around the product, the request was
refused. Rascards was forced to switch supplier (29 p. 29).
Purchasers may have limited control if supply chains are lengthy and complex with products having
multiple owners, or if they cross international borders (2 p. 24). The 2008 Construction Resources and
Waste Roadmap notes that “[d]iscussions with industry stakeholders have identified the difficulty of
achieving change with a fragmented supply chain” (85 p. 32). Similarly, a 2005 study of waste
minimisation practice in the food and drink sector in the East of England found that “the packaging from
imported products has become a major problem for food producers. Audited companies had to keep a
number of containers from imported raw materials on-site as they were non-returnable, non-recyclable,
and unacceptable for landfill” (24 p. 23).
Another barrier may be the wilful obstruction from suppliers resistant to change; a particular problem
when greater visibility in the supply chain would reveal vested interests and unethical practices. For
example, the construction logistics company Wilson James found that its CCC approach, which tackles the
problem of over-ordering of materials, was the ‘‘worst nightmare to some people in supply chain, as they
had been able to make money from the inadequacies of the conventional approach”. At the end of one
construction project, over £200,000 of unused and unclaimed materials were left in Wilson James’s CCC
which would not normally have been visible on conventional projects a (28). A parallel comes from the
State of Oregon, USA where several businesses participating in an initiative to reduce packaging “were
provided with information from packaging suppliers or potential suppliers that was misleading or
a Wilson James eventually overcame this ‘cultural resistance’ in suppliers used to delivering materials on an ad hoc basis. The main ‘stick’ being the threat that
“non‐compliant deliveries to site would be rejected and turned away”. Wilson James reports that a “good number of suppliers were not only ‘won over’ by
the new approach, but they continue to use and pay for the Consolidation Centre for their own businesses on projects where it is not specifically required”
(28).
30 For Defra