Every good thing comes at a cost
The digital transfer of information lowers the need for big stores and creates on-demand production. This shift minimizes production waste, emissions, and the usage of large warehouses that consume useless resources. However, each potential positive impact is coupled with a potentially harmful effect. Each e-commerce industry and its supply chain poses its challenges. Even though e-commerce business models reduce the transportation emissions of consumers and employees, their delivery trucks do not. So the question remains- how do we improve? Innovative thinking, as well as technological advancement, may hold the key to lowering the carbon footprint of the industry.
4 min readAug 19, 2023
According to Statista, worldwide e-commerce sales were $5.2 billion in 2022; this number is expected to reach $6.3 billion by 2024. As consumer behavior and preferences recalibrate and adapt, e-commerce will continue to make more sales than traditional retail stores. In the US, e-commerce contributed 74.6% of all sales in 2022.
However, as much as items are purchased online, in correlation, the amount of waste grows. From an environmental perspective, over 2 billion tons of e-commerce-related waste fill landfills yearly. In addition, fashion accounts for up to 10% of global carbon dioxide output and a fifth of the plastic produced globally.
But the main contributors are the Supply chains that can account for up to 90% of a company’s carbon footprint. So is there a way that e-Commerce can lower or minimize the environmental impact of businesses?
Oliver Wyman’s report “Is e-commerce good for Europe?” evaluates
Focuses on the positive and negative impact E-commerce has on the environment. The report states that online shopping has 1.5–2.9 times fewer greenhouse gas emissions than in-person shopping. This contrasted online shipping to physical retail stores, storage, parking lots, etc. In terms of minimizing transportation emissions, E-commerce business models can conduct business without physically commuting. Additionally, if e-commerce organizations allow employees to work from home, they can decrease their carbon footprint even more.
The digital transfer of information lowers the need for huge stores and creates on-demand production. This shift minimizes production waste, emissions, and the usage of warehouses that consume useless resources.
According to the UN environment program, e-Commerce brands can be a force for environmental good. Google Flights estimates Informa travelers’ carbon dioxide emissions. More and more companies are encouraging consumers to make sustainable choices.
Another great example is Amazon. Amazon has adopted the Climate Pledge Friendly initiative to help at least 100 million people find climate-friendly products that carry at least one of 32 environmental certifications.
However, each potential positive impact is coupled with a potentially harmful effect. Each e-commerce industry and its supply chain poses its challenges. Even though e-commerce business models reduce the transportation emissions of consumers and employees, their delivery trucks do not. And due to the emphasis on fast delivery, businesses send out freights that are partially full. Moreover, using packaging in delivery creates a vast amount of waste. Regretfully, most of the packaging involved in shipping often ends up in the Great Pacific and landfills; although consumers can recycle most packaging materials, they do not. And finally, there is an extremely high return rate on items purchased through e-commerce. This is a constant source of negative environmental impact with transportation emissions and packaging materials. A returned item takes double transportation; if the item is exchanged, it is tripled.
