Sustainable Operations and Supply Chain Management in Starbucks - Case Study Example

Environmental studies: Report Author’s name Institutional affiliation Table of contents 1.0 Starbucks Coffee Company 1.1 Introduction 1.2 Executive summary 1.3 Environmental assessment 1.4 Economic assessment 1.5 Conclusion and Recommendations 2.0 Environmental, economic, and social benefits and costs of a company’s waste management packaging system (packaging issue) 2.1 Abstract 2.2 Introduction 2.3 Environmental assessment 2.4 Economic assessment 2.5 Social assessment 2.6 Conclusion and recommendations 3.0 References Report 1.0 Starbucks Coffee Company 1.1 Introduction A shift to the economy that promotes prosperity while simultaneously establishing a healthy environment as well as social equity in the future and present generations relies heavily on promotion of recycling especially if it’s able to reduce the environmental impacts right from the raw material extraction to processing (EEA, 2011). Additionally, recycling creates Jobs, offers business opportunities and guarantees secure supplies of vital resource. In this case, therefore, understanding the influence of recycling activities to the green economy is tough because environmental and economic data are not directly planned to serve that specific purpose. 1.2 Executive summary Starbucks Coffee Company is a company that is incorporating sustainable packaging materials into its design of cold beverage cup. For this to be accomplished, Starbucks is discovering substitute materials for its present polyethylene terephthalate cold beverage cups. The Starbucks is also looking to better is environmental performance using the Life Cycle Assessment. Additionally, to support this effort, nature works and Starbucks have collaborated to evaluate the environmental performance of bio-based materials and plastics. Moreover, the Starbucks environmental assessment was examined and evaluated using the Life Cycle assessment (LCA) methodology. Additionally, LCA requires data compilation of the various processes under analysis as well as the evaluation of their environmental impacts. Moreover, LCA is made up of four distinct phases. The first phases comprises of the goals and scope of the study which revolves around the objective and theoretical framework of the study. The second phase is the Life cycle of the inventory which basically revolves around the input and output assessment of energy and mass flows in respect to the operations that occur along the goods and services value chain. The third phase of LCA is the Life Cycle Impact or rather the evaluation of the relevance of the organization to the environment. The fourth and final phase is interpretation of information and data that was employed in the study. Starbucks Coffee Company is concentrating in incorporating its sustainable packaging operations and materials into its designated cold beverage cup models. Additionally, In order to realize this, it is recommended that, Starbucks should explore alternative operational elements for its already existing Polyethylene terephthalate (PET) flat lids and cold cups by seeking appropriate and better environmental performance attributes when evaluated using a Life Cycle methodology. Additionally, Nature Works LLC can serve as a potential supplier of Polytacide (PLA) which is an alternative to PET. 1.3 Environmental assessment The environmental assessment in Starbucks corporation company is achieved using the procedure of life cycle assessment ,that requires data collection for the maximum representative material as well as energy outputs and inputs of the processes under study as well as their effects on the environment. Additionally, Starbucks coffee company is continually upgrading its environmental performance sustainability. As a result, Environmental performance of present Starbucks cold beverage cup and Lid prepared from PET and probable alternative material selections such as PP and Ingeo have been analyzed (Miller & Blair, 2009). The results of their assessment postulated that, the different weight situations for cup and lid heaviness for PP and Ingeo indicate a small impact on the environmental footprint associated to the material portion of Ingeo PP situations, and their impact on transportation by train is insignificant. However, the outcomes may differ for other PLA production skills. Moreover, it was established that, the Ingeo situations have lower effects on global warming probability than either the PET or PP situations. To explain further, PET, that is presently used, has the greatest carbon footprint of all situations. By so saying, it means that, the materials are the greatest cause of emissions for the PET and PP situations. In summary, the assessment established that, the manufacturing stage creates the most releases for the Ingeo scenarios due to the greater number of raw materials. Ingeo 2009 has lower effects than PET for Global Warming Potential. In summary, the decrease in Global Warming Potential results due to the lower Primary Non Renewable Energy Demand (NRC, (2001). 1.4 Economic assessment The economic assessment of the Starbucks corporation company is carried out using Input–Output examination, which is an established method to account for the unintended effects of economic activities. The present global utilization of plastics is more than 200 million tonnes, having an annual growth rate of approximately 5% which shows the largest area of application of crude oil. This shows how dependent the plastic industry is on oil. Increasing the price of natural gas and crude oil has an economic impact on the plastic market (www.european-bioplastics.org). Due to these reasons Starbucks Corporation sees it important to use alternative raw materials. The usage of petrochemical-based plastics for example polyethylene terephthalate (PET), polystyrene (PS) polyvinylchloride (PVC), polypropylene (PP), and polyethylene (PE) have been utilized as packaging materials since they are readily available at low cost and possess good mechanical performance. But nowadays the usage of petroleum based plastics has to be regulated because they are not biodegradable hence they pose severe ecological complications. Recycling of the Plastic packaging materials is impracticable since they are often contaminated by biological substance and foodstuffs. The economic evaluation considers that in the sequence of its economic activity, Starbucks utilizes resources, such as waste or labor directly from industry and carry them to recycling. The model established to study the economic impact of Starbucks corporation involves the recyclers (REC) , SPV, rest of the economy (ROE), and the MWS sector. Starbucks considers using the PLA (polylactide) which is a family of decomposable thermoplastic polyester prepared from renewable resources that is currently seen as one of the favorable polymers for commercial usage as an alternative for polyethylene terephthalate (PET), high-density polyethylene, low-density polyethylene (LDPE) and, polystyrene (PS).it is made by conversion of carbohydrates sources such as corn, into dextrose.it is then fermented into lactic acid through direct polycondensation of the lactic monomers. By polycondensation of lactic monomers, PLA pellets are achieved. The initial investment for purchasing the processing machines is very high but maintenance of the machines is low. The process ranges from injection molding, extrusion to blow molding and lastly thermoforming. Starbucks considers using the PLA because the starch in it is readily available and it is biodegradable. To produce a plastic, plasticizers (glycerol, sorbitol) are very essential. 1.5 CONCLUSIONS & RECOMMENDATIONS Starbucks should use the environmental performance outcomes centered on the analysis of the Chosen alternatives. The choice must consider the Study boundary situations and assumptions that transportation is mostly done by train and all the materials have inactive behavior if they are to be gotten rid of in a landfill operation. When concentrating on GWP (depletion of fossil energy causes and summer pollution), both of the different material selections considered in this study indicates important potential to decrease the environmental effect of cold drinking cups over the present use of PET. Changing to Ingeo 2009 as a material would decrease PED, and GWP (global warming potential). Transportation through train does not add significantly to the performance of the environmental. Therefore an emphasis on transport through train over transport through truck should be considered for future when expanding the market. The increased use of biomass as source of energy and raw materials is crucial in the long term since the natural resources and crude oil resources are limited. Plastics and bio plastics cover a plenty of types, each having its own specific profile, so they present a massive diversity which creates them so successful in many applications. As it is anticipated that the infrastructure for using recycled polymer drinking cups will develop in the future. Using of recycled cups should be added as a situation to control the potentials and risks related with closed loop recycling. Biopolymers accomplish the environmental worries but they exhibit some limitations in terms of performance like thermal resistance and mechanical properties, related with the costs. Therefore, this kind of packaging materials requires more research, more additional value like the introduction of smart and intellectual molecules capable to give information about the characteristics of the food inside the package and nutritive values. It is crucial to make researches on this material to improve barrier properties, and guarantee food properties integrity. 2.0 Environmental, economic, and social benefits and costs of a company’s waste management packaging system (packaging issue) 2.1 Abstract The impact of the system of management of packaging waste on the economic growth, environment as well as the social benefits and costs such as job creation is evaluated and analyzed in this report. Additionally, the main intention of this report is to fill the gap existing in literature studies as far as this packaging issue is concerned and its impact on the environment, social and economic impact using a waste management packaging system from Portuguese known as SIGRE. To explain further, the environmental impacts of SIGRE are evaluated using the LCA (Life Cycle Assessment) technique. By so doing, the results clearly indicates that, From the various categories that were researched, the impacts of SIGRE’s activities are in most cases surpassed by advantages that accrue as a result of material and recovery of energy with a particular concentration on energy. Moreover, the economic assessment of SIGRE was evaluated using the Input-Output analysis. As a result, it was postulated that, its activities have a noticeable economic impact. As an example, their added value are positioned among the best third of those economic activities that gives a greater multiplier effect nationally such that it generate 1.25 additional euro for each euro of its value added amounting to the 2.25 multiplier effect. As far as social impact is concerned, the number of jobs created directly is approximated to amount to a number more than 2300 workers. From this data, 83 percent are directly linked to the management of municipal packaging of waste through selective sorting and collection. Fifteen percent are linked to collection and management of [packaging waste that is not from municipal whereas 2 % are linked to Sociedade Pinto Verde which is a waste management system that is responsible for SIGRE. Therefore, in summary, the results postulated by this study establish quantitave support to the suggestion that was passed by EEA (2001) that climbing the hierarchy of waste from filling of land to recycling boosts the economy as well as creating jobs. 2.2 Introduction A shift to the economy that promotes prosperity while simultaneously establishing a healthy environment as well as social equity in the future and present generations relies heavily on promotion of recycling especially if it’s able to reduce the environmental impacts right from the raw material extraction to processing. (EEA, 2011). Additionally, according to the EEA, (2011), recycling creates jobs, establishes business opportunities and sees to it that there are secure essential resource supplies. However, comprehending the impact of recycling this economy is kind of difficult because environmental and economic data are not established and structured to serve that purpose directly. Literature review postulates that there exists a consistent knowledge base regarding the environmental waste management such as the Lazarevic et al. (2010) and the Merrild et al. (2008).Additionally, there are also research studies that combine economic and environmental evaluation such as the Larsen et al. (2012) and Reich (2013).In other words, therefore, there are very few studies that combine social, environmental and economic tools that analyses waste management systems such as the Klang et al.(2003).Owing to this fact, this report aims to fill this research gap by giving a set of approaches that clearly, quantify the economic, social and environmental impacts of SIGRE. 2.3Environmental assessment The assessment of the environmental impact was performed using The Life Cycle Assessment (LCA).In this cases study, the referenced Unit Functions was the Total packaging waste that is currently managed by SIGRE’s SPV in 2011.Additionally, SPV is responsible for managing packaging of wastes that enters SIGRE whether it is emanating from the financial contributor or otherwise. LCA can either adopt the consequential approach or the attributional approach in conducting this environmental assesments.In this case, LCA adopted attributional model in calculating SIGRE’s environmental impact. By so saying, it means that, both extra-urban and municipal systems were modeled in respect to their setting in 2011 add moreover, their co-products were accounted for using the avoided burden approach or substitution by expansion of the system approach (PE, Americas, 2009).Additionally, the consequential model was employed in scenario evaluation of those impacts that are avoided as a result of recycling of packaging materials (REN, 2011).The environmental impact assessment basically revolved around five main environmental impact areas which include climate change, acidification, photochemical ozone formation, depletion of renewable resources and water resource depletion From the data sources, it was postulated that, the materials that are the major driving forces behind the overall importance of a packaging management system (SIGRE) are paper/cardboard and glass. Additionally, their contribution is down to a number of factors which include; the larger amount glass and cardboard managed in the year 2011in respect to the other relevant materials. The second factor is the advantages that accrue from their recovery process. Additionally, from the five categories postulated the impacts that occur as a result of sorting, collection activities, transport, recovery and disposal of waste offsets the benefits that accrue as a result of avoiding environmental effects and impacts. 2.4 Economic assessment SIGRE’s economic assessment was conducted using the Input-Output model approach which accounts for economic activities effects that are indirect (Miller and Blaire, 2009).Additionally, this model postulates that, during an economic activity, a company employs resources such as imports or labor which are automatic direct impacts of the company. Furthermore, the company also buys services and goods from other firms which on the r hand, are themselves going to employ the resources as well. The model that was established to assess SIGRE’s economic impact comprises of four sectors, the SPV, ROE, REC and the MWS. By explanation, this model is explained in table 4 which clearly shows the non-zero attributes of Z, y, x, and v. In the table, the rows explains the source whereas the columns explains the destination TABLE 4 z ROE SPV MWS REC Y ROE A B C E SPV F MWS J K REC L v O P Q Sector ROE (Rest of the economy) which comprises of components A, O and E in table 4 was constructed using the 2008 symmetric fundamental prices of good by good input-output tables of Prospective Planning and International Relations department (Dias and Amingos, 2011).Additionally, investment was computed using the national accounts table 3 using the method explained in Treloar and Lenzen (2004). The economic effect of packaging waste management (SPV) was postulated using the activity report of 2009 (SPV, 2009).Additionally, components B e P is SPV purchases to other firms and primary factors. Moreover, F is a component that represents VPV fee that is paid by package producers that are obtained as subset of ROE. To explain further, component G represents VLR payment that is received by SPV as a result of recycling and finally, component J represents the financial support by SPV to the packaging waste management sector. Modeling of the Municipal Solid Waste MWS represents over ninety percent of the overall total payment that accrues from SPV to the sector that governs municipal waste. Management and evaluation of undifferentiated solid waste is part and parcel of NACE 37. C, K and Q components of table 4 were modeled from Cruz et al.( 2012), Rodrigues (2009) and Lavita (2008).All this information were used in description of physical flow of waste, collection and sorting of waste and postulation of expenditure as well as general costs and depreciation that revolves around packaging waste. Modeling of the sector responsible for recycling (REC) as divided into four basic material categories which includes, plastic, glass, metals (aluminum and steel), wood and paper. Additionally, each basic material category was constructed as being similar in technology to the corresponding subsector in ROE that in one way or the other produces the same product.by enumeration, this products are NACE 17, 23, 22 and 24.The size of each of the sectors used in recycling was considered relative to the magnitude of the corresponding sector that is not used in recycling, Additionally, For computation purposes, each sector used in recycling was constructed as a sub branch within the non-recycling sector branch. By so saying, REC is established as an intermediate sector that is able to receive VLR payment that comes from SPM and then in the process, it delivers the payment to the corresponding raw material branch without incurring any additional expenditure of revenue as shown in Table 2 above (SPV, 2009). The analysis of the Packaging waste management system multiplier gives an international view of the function the packaging waste management system plays in the economy. By explanation, Of the 28 branches of all the economic activities, SIGRE is ranked position 28.It can therefore be concluded that, SIGRE offers a positive economic impact given that it is among the upper third of the world eco0nomic activities. 2.5 Social assessment Social assessment concentrated on the characterization of the employment that was provided by SIGRE activities. Additionally, the longitudinal analysis of this social assessment accrues from the company’s population and firms that work together with SPV within the years 2000 and 2009. Information and data about collaborating companies was provided by SPV and it was arranged according to the relationship they share with MWS, SPV, REC, and WMO. The main problem associated with data collection was the location of firm’s headquarters, some companies are involved in a number of economic activities and moreover, the legal commencement of the firm is not really the startup year of the firm’s activities At the international level, according to UNEP, at least 20 million jobs are created as a result of waste management activities and moreover, over 15 million individuals around the globe depends highly on the garbage to earn a living. According to the SIGRE case study, the quantity of firms that are involved in SPV has improved as from the year 2000 to the 2009.In other words; those firms that are associated with PSV accrue higher initial capital as compared to those that are not associated with SPV. 2.6 Conclusions and recommendations As far as environmental dimension is concerned, it is recommended that, SIGRE should channel its activities towards creating barriers to emission of 116 kt CO2 which can be equated to the amount of carbon produced by over 38600 pine trees for thirty years. By so doing, it will present the only alternative that offers a positive environmental impact in all sectors .For instance, SIGRE will help in avoiding the emission of 396.240 ton carbon dioxide equiv as compared to situations where packaging waste will be collected indiscriminately alongside other waste and transported to energy recovery. Application of nanocomposites to control waste material improves the oxidation and mechanical stability and as well as improving the Barrier properties of this materials. Additionally, barrier properties are vital in food packaging through its ability to obtain access by moisture or gases as well as light. Additionally, the nanocomposites reduce the spoilage rate and hence increasing the shell life of a particular product including recycling of waste. Promotion of smart packaging will be vital in waste management. By so saying, it means that, A package can be modified through is functional characteristics that improves consumers as well as the product itself. By definition, it is fundamentally an integrating technique that revolves around the chemical, mechanical as well as electronically driven roles that improves the functioning of the food products. By so doing, it will help in reducing the nature of packaging waste In summary, this report offers a comprehensive impact assessment of the net environment, social impacts as well as the economic impact of a packaging waste management system. In other words, the methodology used in this case was applied to SIGRE ( a packaging waste management system that is managed and evaluated by SPV (Sociedade Ponto Verde). Additionally, this report clearly presents the quantitative implication of EEA (2011) that dealt with a Portuguese research study of management of packaging waste from the landfilling process to the recycling process that in other words creates jobs as well as boosting the economy References G.R. Inns, PEC Partnership Limited, UK, (2012).The packaging Supply Chain. 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