May 1, 2008

Greener Pastures Ahead

By DC Velocity Staff

Key themes at NA08 include sustainability, economic opportunity

It may have been merely a coincidence that Earth Day fell in the middle of NA08, which ran for four days last week in Cleveland's massive I-X Center, but the theme of green ran throughout the conference.

Produced every other year by the Material Handling Industry of America, NA08 provides material handling and logistics providers with an opportunity to showcase their newest products and services. And this year, the largest material handling show in North America also challenged logistics and distribution professionals to think green.

From the keynote address (which occurred on Earth Day itself) to educational sessions to a special Green Pavilion, the show placed a strong emphasis on the rapidly emerging trend of environmental sustainability. In the Green Pavilion on the show floor, attendees met with representatives from companies, government agencies, and other organizations that focused on green business practices, including the Ohio Fuel Cell Coalition, the Cleveland Sustainability Council, the United States Environmental Protection Agency, and the Michigan State University School of Packaging.

Meanwhile at the keynote address, Andrew Winston, author of Green to Gold, spoke about how the themes of the green movement relate to business in general and supply chain operations in particular. He noted that several of the world's largest companies are now making sustainability a priority, and their efforts will drive continued (and rapid) adoption of broader environmentally friendly business practices.

The most notable of these companies, according to Winston, is Wal-Mart. The retail giant has already alerted key suppliers that shelf space will soon be determined, in part, by a product's environmental impact.

Winston urged attendees to embrace rather than resist the green movement in business by being willing to proactively adapt to the changes ahead. Invoking a quote from Charles Darwin, Winston reminded the crowd, "It's not the strongest of the species that will survive, nor the smartest, but the most responsive to change."

(For more insights from Winston, see our exclusive interview with the author from our March issue. For more information on the greening of the supply chain, check out all our stories on the topic at our Green Channel.)

Strong sales
Another takeaway from the show: a general sense of optimism, despite the slowdown in the U.S. economy. Consider the viewpoint of Peter Chase, executive vice president of storage solution company Konstant. "Recession?" said Chase. "We don't see it. We expect the summer to show the usual summer dip, but we also expect a very strong fourth quarter."

Konstant expects that a significant portion of those sales will be coming from Southeast Asia, where the company is looking for further growth thanks to the weak dollar. Konstant is not alone in its pursuit of sales outside the United States. Much of the optimism expressed at the show is due to material handling providers' ability to reach markets beyond U.S.'s borders.

Jonathan Ball, senior vice president and chief financial officer, Jervis B. Webb Co., a subsidiary of Daifuku, explained that while the economy is showing a significant slowdown in some market segments, it is doing well in other parts of the world. In particular, China and India are continuing to invest in new material handling automation and systems, said Ball.

Robert B. Konermann, segment marketing manager for Schneider Electric, agreed. "It used to be if the United States sneezes, the rest of the world gets a cold," he said. "Not so anymore. This is a global economy and while there may be a downturn in the U.S., Asia and Europe will be up. We've been growing at around 20 percent every year for the last four years. ... There's no worldwide recession coming for material handling."

More coverage from NA 2008