CARGO EDGE Blog

12.02
2021

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All hands on-deck to release the supply chain log jam sustainably

Shippers are doing themselves and customers a disservice by relying heavily on single-use asset tracking devices. Similar to mobile phones, each one requires multiple microchips, sensors, and a battery to function. You don’t throw your phone away after each call, so why send your tracking device to the landfill after a single shipment?

The proliferation of single-use devices means valuable microchips are being used once and tossed. Not only does this contribute to the global e-waste problem, but it robs component supply from others that are creating more sustainable products. The providers that offer single use devices, and the shippers that use them, are all too often unnecessarily gobbling up more than their fair share of the chips, exacerbating the semiconductor shortage that’s impeding more sustainable use. These impacts are widespread in the mobile electronics arena, not to mention the automotive industry, as well as computer, smartphone, and other tech manufacturers. Chip manufacturers can’t make enough products to meet their own needs, according to the Wall Street Journal.

The microchip shortage was a long-time in the making and it will take time to claw out of it. It all started when chip manufacturing facilities in Asia closed due to rising COVID cases. Then droughts in Taiwan impacted key manufacturers’ water use, further impeding production. Now chip makers can’t find workers and material costs are through the roof.  According to IPC International, which represents chip manufacturers, 80% of chipmakers are having a hard time finding employees with the right training to handle the highly toxic compounds used to manufacture semiconductors.

It’s an all-hands-on-deck moment to resupply the market with needed chips.

In a recent analyst meeting, it was made clear to me that our company is an outlier when it comes to reusability. Digging deeper on this front, we looked at 20 competitors and discovered that almost half (45%) rely on single-use devices. Customer feedback validates the trend. Many are heavy users of single-use devices, mindful of the wastefulness and considering options.

When you consider the scope and scale of the global supply chain and the proliferation of single-use electronics, it’s clear this is a problem that demands more attention. These devices serve a single shipment, consume precious component supply, and then become waste, leaching hazardous chemicals until they fully break down hundreds of years later.

In addition to unnecessarily using the already strained supply of microchips, e-waste is mounting. In the most recent United Nation’s E-waste Monitor, a record 53.6 million metric tons of electronic waste was generated worldwide in 2019, up 21 percent in five years.

So, what’s the motivation behind single-use devices? They’re easy! It’s the same principle driving the use of bottled water and paper plates. No one wants to roll up their sleeves and do the dishes. Yes, there is some effort involved in reverse logistics but with powerful batteries and tools to make charging, storage, and recovery easy, re-use is easy.

Re-use requires all players in the supply chain, from shippers to consignees to logistics providers, to play their part. An effective reuse program stands to lower overall costs for everyone in the chain because the cost per use is spread over several years of shipments instead of a single event. On top of that, a solid reuse program is a big positive step toward achieving corporate Environmental, Social & Governance (ESG) goals.

OnAsset’s customers have always adapted and risen to the challenge to provide better supply chain visibility, and now we’re all being called to the higher purpose of sustainable operations. We can do this together.