We deployed teams to talk with local businesses about how they are preparing for climate change impacts; we explored the resources and tools businesses and communities need to better adapt during our Businesses Acting on Rising Seas (BARS) Campaign. This is an excerpt from our 2018 Businesses Acting on Rising Seas Report released in March. Click here to further explore our findings and hear the stories of business owners who are already facing the first impacts of climate change.
Climate change is not an isolated problem. According to the most recent IPCC report, keeping global warming to 1.5 degrees celsius above pre-industrial levels will require, “rapid, far-reaching and unprecedented changes in all aspects of society.” It is also clear that the climate crisis will have unequal impacts, with nations in the global south largely facing higher risks more rapidly.
While the direct impacts of climate change might vary from country to country and city to city, there are a variety of ways in which its effects on businesses are felt across borders.
We spoke with companies involved in both retail and professional services here in Massachusetts. We connected with over 80 restaurants and cafes, antique and art shops, and companies focused on law, architecture, and marketing — all businesses that can be impacted by disruptions in their supply chains. 47% of businesses we interviewed indicated that their supply chain was vulnerable to the impacts of climate change and extreme weather events.
Our Local Business Resilience Guides include considerations for increasing supply chain resilience, as disruptions in supply chains can result in serious harm to revenues and businesses’ ability to remain open during climate impacts. We recommend having extra supplies on hand, having more than one supplier, and being mindful of sourcing as ways to ensure redundancy and make businesses more resilient overall. This provides both an opportunity and a challenge for businesses, as they can increase the sustainability of their overall operations by considering the environmental impact of their supply chain. Yet they can also be limited in their options for suppliers, forcing them to choose from what’s available and most cost-effective based on the market demands, and not necessarily based on the most sustainable options. The complexity of supply chains can also increase climate risks. For grocery stores, climate change can have an impact on both the availability and quality of the food supply. Changes to the natural environment that are either abrupt, from natural disasters, or more gradual from sea level rise or increasing drought conditions, can cause agriculture lands to become nonexistent or inaccessible, causing farmers to move. This means that climate impacts in countries other than the U.S., countries that we rely on for imports, also have ripple effects and end up affecting the local economy.
Seeking Solutions in Technology
Businesses need to re-evaluate their global supply sourcing and determine if any of their day to day goods could be affected by climate impacts. They can also embrace automation and blockchain technology to improve their logistics and enhance their sustainable sourcing. Restaurants, retail shops, and marine repair shops are heavily dependent on a steady stream of supplies and severe weather events can make it impossible to drive or fly products to their destinations. Any delay in delivery can have a negative effect on business continuity.
Companies on our main streets and within our business districts are deeply tied into the global marketplace. Within this marketplace, automation and blockchain can build and benefit from each other. Automation can trigger the switch to a different supply route due to expected inclement weather, or let a business know when they are running out of a product and instantly re-order it, saving valuable administrative hours. Blockchain technology is a distributed ledger that is available to everybody, allowing every kind of asset to be moved and transacted without the need for an intermediary. It creates a public registry of who owns what and who transacts what, all encrypted and linked together. Along with automation, blockchain can assist in tracking goods (shipment), quality assignment (sustainable or organic sourcing), linking goods with digital tags, and sharing information about suppliers and vendors. Providing this information together promotes transparency, scalability, security, and room for innovation. By removing intermediaries, it promotes greater efficiency, and it can ensure businesses have supplies needed prior to a storm or route supplies to avoid inclement weather altogether. Blockchain and other innovations in technology have great potential when it comes to allowing businesses to become more resilient and find solutions to climate impacts, especially as those become more disruptive for their operations.
- ECONOMIC GROWTH IS STUNTED by increasingly common extreme weather events, impacting production and global trade.
- Massachusetts small businesses are impacted through disruptions in their supply chains. SUPPLY CHAIN DISRUPTION includes goods stuck in transit from weather events as well as sources that are becoming rare and unattainable due to gradual or sudden changes in the natural environment.
- BUSINESSES NEED TO EVALUATE THEIR SUPPLY CHAINS and determine if they can retrieve needed products from multiple suppliers.
- Embracing AUTOMATION TECHNOLOGIES CAN BRING ABOUT EFFICIENCY and sustainable sourcing.
- RETRIEVING THE CONTACT INFORMATION OF ALTERNATE SUPPLIERS will allow businesses to recover from weather events and disasters in a more timely fashion.
Business Accounts of Weather Impacts and Preparedness
PRODUCE CENTER AND GROCERY MARKETS CHELSEA AND CHINATOWN
Businesses that use perishable products rely on timing to get their supplies before they decay. Companies that handle produce are vulnerable to changes in the climate in the regions where those products are grown, as well as the transportation of perishable foodstuffs.
We spoke with 40 businesses in Chelsea, where it was impossible to ignore the prevalence of refrigerated trucks around town, most with logos and designs including carrots, grapes, and bananas. Some of the freshest produce can be found in the local Chelsea markets we visited, like Luna’s Market and Community Latin Grocery. Local business owners are quick to mention that a central part of the Chelsea landscape is The New England Produce Center. The center plays a huge role in the distribution of fruits and vegetables — it supplies produce to over 8 million people all over New England, even extending to parts of New York and eastern Canada. However, the supply chain from this location is already at risk. Abutting the Mystic River, the location has experienced an increasing number of flooding events. Higher intensity and frequency of such events not only puts the produce distribution facility at risk, but also threatens transportation, as flooding is expected to overtake train tracks, a major shipping method for produce in and out of the center, and make roads to and from the facility impassable. This not only impacts all of the individual distribution facilities within the produce center, but all the businesses relying on them for deliveries. There are a number of grocery stores and produce suppliers in nearby Chinatown in Boston that are vulnerable to the impact of climate change on their supplies. Not only can climate change affect the timing of when they are receiving their products, it can also affect their cost.
An employee at Heng Fat Produce, one of the produce suppliers in Chinatown, spoke to us about how the cost of fruits and vegetables has increased due to availability. Changes in temperature and challenges in producing a certain crop where it is grown can cause its price to increase.
DESIGNER’S CHOICE CHELSEA
Climate change can not only impact how food is grown, but other plants as well. When speaking with Miguel at Designers Choice, a local distributor of fresh-cut flowers in Chelsea, he made the connection between climate risks and his supply chain. When asked about his risk to climate change, Miguel rated it as a 7 out of 10. However, when he considered that his shop’s flowers are dependent on the climate where they are grown, he increased his risk to a 9 out of 10. “All of our product comes from South America and it typically comes into the US through Miami. So our product travels a long way to get here in trucks. Whenever there are storms, our trucks are delayed. We work on a pretty tight schedule so, even a couple hours throws everything off.” With perishable products traveling such a long distance, any weather-related events along the way can disrupt their inventory and affect their sales.