Each of the scenarios to follow describes a sustainability- related cost item for organizations in recent years. For each scenario, identify which function of the value chain that cost would represent (R& D, design, purchasing/ producing, marketing, distributing, or customer service.)
a. Bert’s Bees, a manufacturer of products such as lip balm, has developed a new soap label called TerraSkin (™) Wraps that is “treeless” and “bleach- free” (it is a paper- label alternative). The cost of researching the proper process and combinations of components for this new label would fall into which function in the value chain?
b. The Kellogg Company, known for its breakfast cereals, has successfully switched the majority of its packaging over to 100% recycled materials, 35% of which is consumer-recycled. According to the company’s analysis, the impact of this achievement can be found in the decreased overall carbon footprint left by the company, as well as increased recyclability of this packaging. The cost of designing the life cycle of ­Kellogg’s packaging would fall into which function in the value chain?
c. Patagonia, a clothing manufacturer, launched a program in 2005 called the Common Threads Initiative. In an effort to prevent clothing from going to landfills, the company collects used and damaged garments from consumers. These textiles are then salvaged and recycled as new products. The costs involved in running this program to take back used garments would fall into which function in the value chain?
d. General Mills produces a variety of different foods. The company recognizes the ­importance of encouraging good nutrition among the youth of America and has taken special initiative to ensure that its marketing strategies promote healthy lifestyles. It avoids targeting children under twelve with advertisements for foods that are high in sugar. The cost of these marketing campaigns would fall into which function in the value chain?
e. The Target Corporation, a retailing company, offers a line of garments that have been treated for stain management. However, such treatments usually include a chemical ( PFOA) that has been found to be potentially harmful to humans, so Target only purchases from manufacturers that offer PFOA- free alternatives. The cost of the ­garments treated with the PFOA- alternatives would fall into which function in the value chain?
f. To help offset carbon emissions, U- Haul, a moving truck rental company, gives its consumers an option to donate $ 1 to $ 5 at the time of a transaction. Just two years after its launch in 2007, $ 1,000,000 was raised and 133,000 trees were planted with the proceeds. The cost of these carbon offsets purchased for the delivery vehicles rented by U- Haul would fall into which function in the value chain?