Transport & Packaging

GREENHOUSE GAS EMISSIONS

Transport is critical to the way Ikea works. They sell tens of thousands of different products in their 201 retail locations (5) per year. Their merchandise is manufactured by 2,300 suppliers scattered over 64 different countries (4) and this merchandise is made from multiple parts that also come from several other sub-suppliers from around the world.

The route from supplier to store is a long one so Ikea has a significant potential to impact the environment with its transportation activities. They rely 60% on road transport, 20% on rail, 20% on ocean, and less than 1% on air. The transportation industry is almost 100% dependent on fossil fuels, which contributes to local and regional pollutants such as nitrogen dioxide, sulfur dioxide, volatile organic compounds, and particulates (34). Approximately 80% of the total amount of carbon dioxide emissions generated by Ikea activities comes from the transportation of goods (34). Worldwide, 30% of the total amount of carbon dioxide emitted comes from transportation. Ikea's long term goal is to reduce carbon dioxide emissions by the end of FY 2008 to 9% per transported cubic meter per kilometer. (11)

TRUCK TRANSPORT

Ikea uses 170 freight forwarding companies across the globe and require them to meet certain environmental targets. When Ikea negotiates new transport services, the supplier must have an environmental policy and an action plan that ensures that Ikea can account for the company's environmental performance. All of Ikea's road freight companies in Europe produce an annual summary of the impact they have on the environment by responding to an Ikea questionnaire known as the Environmental Performance Sheet. (11)

Ikea participates in a program called Clean Cargo and Green Freight, which was developed by members of the Business for Responsibility's (BSR) Green Freight Group, a worldwide committee consisting of multinational corporations who have voluntarily developed environmental guidelines for land and ocean transport. The goal of the program is to promote sustainable product transportation by land. The group is developing voluntary environmental specifications and guidelines to elevate the performance of their fleets or carriers and inspire broader movement toward a sustainable transportation future (35).

Ikea participates in US EPA's SmartWay Transport Program, a voluntary partnership between various freight industry groups and EPA that establishes incentives for fuel efficiency improvements and greenhouse gas emissions reductions (33). EPA provides SmartWay Partners with benefits and services that include fleet management tools, technical support, information, and public recognition. Ikea's fleets have to provide an inventory of emissions output using a web-based calculator. They must also use the best quality fuels and train drivers on the SmartWay program. Ikea also designates docks at their facilities for SmartWay carriers as an incentive to meeting the requirements. (32)

IKEA OCEAN TRANSPORT

As global trade increases, greenhouse gas emissions from ocean vessels are also expected to rise. Ikea uses the Clean Cargo--Green Freight Environmental Performance Survey for shippers to gauge their carriers' environmental management performance and address the environmental impacts of their ocean transportation. The survey was developed by members of the Business for Responsibility's (BSR) Clean Cargo Group, a worldwide committee consisting of multinational corporations who have voluntarily developed environmental guidelines for ocean transport. The goal of the survey is "to provide shippers and carriers with a common reporting tool to begin examining the overall environmental impacts associated with ocean transportation", explains Michelle Lapinski, BSR's Senior Manager. "The hope is that this survey will lead to better communication between carriers and their customers about fuel efficiency and related environmental improvements that can be sought over time. It's a powerful tool in helping to identify collaborative approaches to environmental management." (35)

RAIL TRANSPORT

Wherever possible, Ikea tries to utilize rail transport and combined roar-rail transport. Ikea was the first company to take advantage of rail system deregulation in the European Union (4). A rail link was approved between Germany and Sweden and in 2001, Ikea established IKEA Rail AB. From suppliers and central warehouses in Germany, Belgium, the Netherlands and Sweden, IKEA Rail provided door-to-door transport of IKEA materials and furnishings, with Ikea trains transporting the goods for most of the way. Ikea estimates that one full train of merchandise eliminated more than 50 truck trips per day (4). By reducing reliance on trucks, carbon dioxide emissions were lowered by 70%, particle emissions halved, while hydrocarbon emissions were slashed by around 80% (29). Ikea checked whether or not engine drivers were trained in fuel-efficient driving techniques (11). However, in October 2003, the Ikea Group decided to end its own rail operations sice it had not been utilized to its fullest extent.

CUSTOMER-INDUCED AIR POLLUTION & ENERGY CONSUMPTION

IKEA has been criticized by one group of advocates, the Mystic View Task Force (MVTF), for being the "most irresponsible retailer on earth in its climate impact". MVTF's goal is to assure the greatest benefit to the people of Somerville, Massachusetts, where development is being planned at the Mystic View Assembly Square. Ikea is one of the stores that plans to put a store here. Many of the complaints and criticisms MVTF has for the Somerville, MA store could hold true to other Ikea stores. This section highlights some points of interest. (30)

MVTF claims that Ikea is blind when it comes to how big of an impact Ikea stores have on energy consumption and air pollution resulting from customers driving long distances. They state that Ikea has not been forthcoming about serious environmental impacts or their efforts to correct them. According to them, Ikea causes more customer driving per sale than any other retailer, causing traffic jams and consuming four times the energy of local furniture retailers. They requested that the Somerville Ikea store to offer free local delivery or to charge reasonable rates for delivery. They feel that by doing this, Ikea would prevent congestion and environmental damage "inflict upon every community they land in". (30)

MVTF estimated that the Assembly Square Ikea would generate greater than 50 million customer miles per year, which would cause the consumption of over 2.5 million gallons of gasoline and emission of over 50 million pounds of carbon dioxide per year. MVTF concludes that these environmental costs will significantly outweigh the benefits gained by Ikea using green building design techniques at the Somerville store. (30)

Several Ikea stores are carrying out trials to encourage employees to use public transportation and to carpool to and from work. Some Ikea stores have their own shuttle buses linking them with the city center or to a regional transportation hub. Ikea tries to locate its stores in areas served by efficient public transportation. Efficient transportation, as defined by Ikea includes public transportation (preferably rail) linking the store to the city center, embark/disembark points within 150 meters of the store exit, timetables must be clearly displayed at the exit to the store, and at least one trip in each direction every hour during store opening hours. (11)

PACKAGING & DESIGN

The overdesign of packaging is the largest US use of paper products and two-fifths of the volume of US landfills (9). Ikea stores generated 143,000 tons of waste during FY 2003 so reducing the amount of waste they generate is one of their top priorities. They try to ensure that as much waste as possible is recycled or used for energy production. Customers can also bring back packaging to Ikea so that it can be reused or recycled. In 1955, by accident, an Ikea employee removed a table’s legs so it would fit into a car and to avoid any damage during transport. It was that moment that Ikea's design for flat packaging was born. Packaging furniture unassembled led to further reductions in price for customers (29). Most Ikea packaging consists of corrugated cardboard with a high content of recycled material (31). In addition clever design of products also help Ikea squeeze more products into every load-carrying unit. This reduces both emissions and transport costs. For example, designer Monika Mulder's prize-winning watering can made more efficient use of transport capacity. The watering can, called Vallo, does not have the long handle, spout, and hollow body of traditional watering cans, which make transport difficult and inefficient. Vallo is made of plastic and is stackable, so Ikea can fit a lot more into every shipment. This tactic reduces harmful emissions and significantly reduces freight costs as well. (17)