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Supply chain miles

How can supply chain miles support strategic choice or positioning?

AccessibleOperationalIndividual2 min read

Contents

A logistics-distance measure for making the travel embedded in purchased inputs and delivered products visible.

Global sourcing allows organisations to buy on price and quality from almost anywhere, but the environmental effect of transport can remain hidden. Supply chain miles record the distance travelled by an input or product from production to final delivery. The idea began with “food miles.” Historical estimates cited in this account suggest that food travelled, on average, between 1,500 and 2,500 miles (4,000 km) on its way to a consumer and that the distance had increased by a quarter since the 1980s. Treat those figures as historical context, not a current benchmark.

When to use it

Answer the performance question: “To what extent are we minimising the environmental impact of our business?”
Assess logistics distance within the corporate-social-responsibility perspective.
Define collection methods, calculation boundaries, reporting frequency and data ownership.
Compare the trend with reduction targets and relevant route or product benchmarks.

Origins

The KPI extends the United Kingdom’s “food miles” concept, associated with food-policy scholar Tim Lang and later campaign work on long-distance food transport. Distance is easy to understand and can expose unnecessary movement, but it is not a carbon measure by itself. Mode, vehicle efficiency, load factor, refrigeration, return journeys, production method and the rest of the product life cycle can outweigh distance.

What it is

Perspective: Corporate social responsibility perspective.

Key performance question: To what extent are we minimising the environmental impact of our business?

Measure travel on the demand side for purchased components and goods and on the supply side for products or services delivered to customers. Report the route and transport mode with the distance so that management can distinguish a shorter but inefficient journey from a longer journey using a lower-impact method.

How to use it

Measurement

Define the start and end points, route convention, unit, mode and whether returns, intermediate processing or empty legs are included.

Data collection method

Use verified production and delivery locations with a mapping or routing tool. Measure individual products or components, or aggregate comparable flows—for example, all inbound distances for one product or outbound delivery distance for a range. Where the actual route is available from transport systems, prefer it to a straight-line estimate.

Formula

Supply chain miles = Distance between location of production and the location of the final delivery

The formula is intentionally simple. For environmental decisions, combine it with load, mass, mode and an appropriate emissions factor.

Frequency

Collect the KPI annually or every six months for a stable network, and recalculate when a supplier, plant, warehouse, customer route or transport mode changes materially.

Source of the data

Use production-site records, supplier master data, transport systems and customer delivery addresses. A supplier’s invoicing address may not be the place where the item was made.

Cost/effort in collecting the data

Manual mapping across many components can be expensive. Automated routing reduces effort once location and shipment data are reliable, but data cleansing and supply-tier visibility may remain substantial.

Target setting/benchmarks

Supply networks differ too much for one universal distance benchmark. Set a baseline and reduce avoidable miles while protecting service, resilience and total environmental performance. A longer route can occasionally have lower emissions if the mode or production system is materially better.

Example

A Philadelphia manufacturer purchases components from Boston and receives them by lorry. A road-distance calculation gives 319 miles for the relevant flow.

The UK National Health Service provides a larger example. A depot at Bridgwater in Somerset used 60 vehicles to make 500 daily deliveries to 3,000 hospitals and general-practitioner locations in the south-west. Mapping and reorganising the network enabled hospitals in Bristol and Bath to avoid more than 10,400 delivery miles—approximately the distance from Bridgwater to Sydney.

Top practical tip

Match the distance convention to the real transport mode: use road routing for lorries, an actual shipping route where available and air distance for flown goods. Document the choice.

Top pitfall

Do not mistake a trader’s office or invoice address for the production site, and do not claim carbon reduction from distance alone without considering mode, load and life-cycle effects.