Chapter 2, Problem 2.32BE

Value chain and sustainability efforts (Learning Objective 2)

SUSTAINABILITY

Each of the scenarios to follow describes some cost item for organizations in the recycled carpet industry. For each scenario, identify which function of the value chain that cost would represent (R&D, Design, Purchasing/Producing, Marketing, Distributing, or Customer Service). Note: The companies and products used in this exercise are real companies with a strong sustainable practices commitment.

1. a. Flor^®, a company that produces residential carpet tiles made from recycled carpet, has an R&R (return and recycle) Program. Homeowners can arrange to have old tiles picked up and shipped back to the plant for recycling. The cost of operating this R&R program would fall into which function in the value chain?
2. b. Los Angeles Fiber Company (LAFC) received the EPA/CARE award to recognize Los Angeles Fiber Company’s sustainability efforts. Since 2000, LAFC has recycled more than 464 million pounds of post-consumer carpet. Its carpet brand, Reliance Carpet, is made entirely from post-consumer carpet fiber. The cost of promoting the company’s products and its sustainability efforts would fall into which function in the value chain?
3. c. Ford Motor Company purchases cylinder head covers made from a nylon resin containing 100% recycled carpel in its Mustangs. The cost of the cylinder head covers would fall into which function in the value chain?
4. d. Axminster Carpets offsets the carbon emissions from its carpet distribution process by investing in renewable energy projects such as wind, power, and hydropower plants. This carbon offset is verified independently by the Voluntary Carbon Standard. The cost of these carbon offsets would fall into which function in the value chain?
5. e. Shaw Industries is a flooring manufacturer. It has created Cradle to Cradle Silver Certified carpet, which is carpet that can be recycled back into new carpet again and again at the end of its useful life, or it can go back into the soil The costs to develop the production process for the Cradle to Cradle Silver Certified carpel would fall into which function in the value chain?
6. f. Fibre(B)lock^® Flooring is manufactured using the waste generated from the manufacture of commercial nylon carpet. The cost of the research into how to create Fibre (B)lock^® Flooring would fall into which function in the value chain?