Logistics

• U.S. Highlights

  As our business has grown, our shipping miles have increased significantly. Despite this, our focus on fuel and network efficiencies has resulted in a reduction in our carbon dioxide equivalents (CO₂e) per-shipment average over the past several years. For inbound logistics, we have reduced our CO₂e per shipment by about 58% since 2010. For outbound logistics, by switching to more efficient modes of transportation and increasing the efficiency of our network by opening service centers, our Logistics teams in North America have reduced CO₂e per shipment by over 60% since 2010!

  The use of intermodal¹ for shipping merchandise is driving some of the reductions we are seeing in greenhouse gas (GHG) emissions as well. This is a more fuel-efficient alternative than trucking alone, and we intend to use this greener transportation alternative where it makes business sense as it reduces both our costs and logistics-related GHG emissions.

  Some highlights from 2017 include:

  • Inbound intermodal to distribution centers was about 78% of miles travelled;
  • About 18% of our outbound shipment miles between our distribution and shipping centers (i.e., crossdock) were intermodal;
  • We continued to ramp up our outbound intermodal mileage for transportation for store deliveries and doubled the number of miles travelled by intermodal to stores compared to 2016; and,
  • One of our rail carriers utilizes trains fueled by liquefied natural gas for select routes in southern Florida for outbound freight; it is expected that these trains will produce fewer emissions than traditional locomotives.

  
  

  In addition to these initiatives, we have opened service centers that are smaller than distribution centers. They are located closer to store "clusters" and designed to improve the efficiency of our store delivery process. We also utilize these service centers to co-locate our Asset Recovery and Recycling Centers (ARRCs) and maximize our delivery trucks’ utilization by backhauling recyclable materials like cardboard and plastic from our stores to the ARRCs.

  Since 2013, we have been working with one of our transport carriers to operate compressed natural gas trucks in two major metropolitan markets. We have increased the number of trucks used in each of the past four years. We estimate that these trucks produce about 22% less CO2 per mile than diesel trucks and that our initiative is helping to reduce CO2 by over 335 metric tons annually. We are pleased with the success of this program and continue to test other efficient methods of delivering merchandise to our stores.

  We are a member of the U.S. Environmental Protection Agency's (EPA) SmartWay Transport Partnership. This program is a collaborative effort between shippers, truckers, and the EPA to find innovative ways to reduce both fuel consumption and GHG emissions. As a SmartWay shipper, TJX is committed to using SmartWay-certified transport carriers. We require that all new U.S. carriers are SmartWay certified. In 2016, the most recent year for which we have data available, 92% of TJX's U.S. land transportation mileage was with SmartWay-certified carriers. To achieve this result, TJX collaborated with carriers to encourage their participation in this program. SmartWay scores are now included in our TJX Logistics Service Provider Questionnaire, which goes out to all prospective U.S. carriers.

  

• Canada Highlights

  In Canada, the majority of our carriers are Fleet Smart or SmartWay approved. (Fleet Smart is the Canadian equivalent of the U.S. SmartWay program.) Since 2016, a significant portion of our Canadian carrier spend was with either Fleet Smart or SmartWay carriers. We are increasing our engagement with our transportation and logistics carriers on environmental sustainability topics and have added environmental sustainability questions into select logistics bids. We are also engaging in discussions with our partners during business review meetings.

  Our initiatives to reduce fuel consumption extend beyond our transport partners. For example, at our distribution centers in North America, we work to optimize store delivery runs by using logistics software to design more efficient routes. We utilize various co-loading methods to encourage use of fully loaded trucks as well as alternative methods to load and unload trucks. We now have a variety of delivery techniques, including traditional deliveries, floor-loaded trailers, pallet drops, and trailer drops. Additionally, we have a night time trailer drop program that reduces drive times to stores and maximizes the space used on the truck. This program is another way in which we conserve fuel, reduce travel time, and decrease the number of trucks on the road.

  In 2016, we began working with a third-party distribution center in Delta, British Columbia. The 450,000 square-foot facility was strategically positioned to support stores in western Canada and will substantially reduce the miles needed to ship products to our stores.

• Europe Highlights

  In the U.K. and Ireland, where we directly manage our logistics, we believe we are at the forefront of innovation in our logistics fleet. We collaborate with our transport providers and incorporate a "green" clause in our agreements, which covers both trucking and store delivery vehicles and commits both parties to achieving key environmental goals. Together with our partners, we continually work on new ideas to increase fuel efficiency and reduce costs, thereby minimizing the impact of our vehicles on the environment. In fact, we estimate that we saved over 1.3 million kilometers of truck travel over 2017 by being more efficient.

  Through our logistics partners, we work with trailer manufacturers to develop innovative designs for our vehicles. Our whole fleet is now comprised of newer lifting deck trailers built for T.K. Maxx, which represent the latest in trailer solutions and offer better durability, more cubic space, aerodynamic profiling, and a host of safety features. We are also using low-rolling resistance tires on new double deck trailers.

  In addition to our existing fleet enhancements, we encourage our logistics partners to pilot hybrid vehicles, and we leverage technology and design to improve logistics efficiency. We are introducing driving-style management applications to provide fuel savings and currently testing 100% liquefied natural gas trucks in London.

  We continue to utilize dual-fueled vehicles (liquefied petroleum gas and diesel) within our fleet to reduce our GHG emissions. We take steps to increase the utilization of our vehicles and to help manage delivery routes more efficiently. We also offer driver education and invest in technologies like vehicle tracking that can help optimize driving habits to reduce fuel costs, improve safety, and ensure efficient routes.

  We also collaborate with other retailers in the U.K. to share capacity on some of our delivery routes. This collaborative approach can eliminate the need for multiple, parallel trips to the same location, helping to further reduce GHG emissions.

  Outside of the U.K. and Ireland, we continue to work with our logistics providers to introduce a new double deck trailer for use across other parts of Europe. We are currently trialing two double deck trailers for transport of products between Poland and Germany. These trailers are designed to increase cubic capacity and deliver improved aerodynamics.

  Altogether, we estimate that our emissions reductions from our European logistics initiatives was 1,300 metric tons of CO₂e.

¹Transportation involving more than one form of carrier during a single journey.