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Sustainable Strategy Model Retail Industry Small Business-Retailer Small BusinessIncome Statement ACTIONIMPACTOUTCOME Sales$10,000,000 Green Products.

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Presentation on theme: "Sustainable Strategy Model Retail Industry Small Business-Retailer Small BusinessIncome Statement ACTIONIMPACTOUTCOME Sales$10,000,000 Green Products."— Presentation transcript:


2 Sustainable Strategy Model Retail Industry


4 Small Business-Retailer Small BusinessIncome Statement ACTIONIMPACTOUTCOME Sales$10,000,000 Green Products New Opportunities Price Premium Joint Ventures 5%$500,000 Labor Cost$1,050,000 Green Design Green Teams Workforce Engagement 10%$105,000 Energy$55,000 Benchmarking/ Monitoring Energy Usage Lamp Replacement/ Programmable Thermostats 10%$5,500 Transportation$45,000 Logistics/ Maintenance/ Telematics 10%$4,500 Packaging/Waste$22,000 Repurpose/ Reuse Recycling 25%$5,500 Click on Action Links for further details

5 Net Income Potential Key Areas:Annualized Impact Net Margin on Sales$75,000 Productivity Gains$105,000 Energy Savings$5,500 Waste/ Packaging Savings$5,500 Transportation$4,500 Total Gain$195,500 +10% Increase in Net Income

6 Kristina Kohl Executive Director Sustainable Strategy

7 Green Products Pumas In cycle collection is the first 100% cradle to grave Basic Certified line of footwear, sportswear and accessories. Products are made from biodegradable or recycled polymers and 100% organic cotton. The products have biological cycle labels to inform consumers about the process and their role in achieving reduce waste, landfill, and pollution. Puma initiated a Bring me Back program to provide consumers with a recycling mechanism and Puma with a raw material gathering vehicle. return

8 New Opportunities In retail industry, 80% of natural capital impact is from the supply chain. Working with suppliers to generate sustainable standard life cycle assessment allows for greening of existing products and packaging. Rigor has been added to the process through scorecards and product lifecycle analysis. These techniques reduce GHG emissions, waste creation, and water usage but also cost. return

9 Joint Ventures H & M has a 3 year partnership with World Wildlife Fund focusing on reducing water usage in the production of products especially denim. This joint venture provided H & M with a means to protect its reputation, deal with investor and consumer concerns and truly make an impact on a scarce resource. return

10 Price Premium Accenture survey of 250 global senior executives reveals that sustainability is key to drive future growth of business (78%). Results indicate that 60% find that a premium can be charged for sustainable product/services and the average premium is 19%. Factors include consumer demand, reputation, brand image, genuine concern about the environment and society, partnerships with stakeholder groups and new markets. return

11 Green Design/ Programs/ Initiatives Green programs, buildings and design impact more than energy cost. Major companies and municipalities such as Lockheed Martin reported a 15% increase in worker productivity and a decline in absenteeism of 15% from day lighting and better energy efficiency. For many companies, a 1% gain in productivity can offset the cost of an energy bill. return

12 Workforce Engagement Research shows that companies that engage in sustainable practice and communicate their commitment to stakeholders including employees are rewarded with higher productivity, an improved talent pool, and lower turnover. Towers Watson reports 15% increase in employee engagement results in 2% increase in operating margin According to the Hay Group, retail employee turnover ranged from 10% for management to 67% for part-time store positions. Cost associated with turnover range from 50%-400% of salary depending upon the position level. A reduction in unwanted turnover, has a significant impact on the bottom line. Research has shown that employees who work for green companies are more engaged, productive, and loyal resulting in lower unwanted turnover. return

13 Benchmarking/ Monitoring Energy Usage Monitor energy consumption in real time. Gathering and analyzing data on energy use by location and equipment allows for decisions on peak usage times and equipment efficiency. Large grocers experience shows a reduction of 5%-10% of utility expense. EPA estimates 2%- 7% annualized energy savings for buildings using the Energy Star Portfolio Manager tool. Maintain equipment per recommended schedule to allow for maximum operating efficiency Benchmark your stores energy usage, understand the effects of weather on locations, compare like stores to identify potential best practices. return

14 Lamp Replacement/ Programmable Thermostats An energy star light bulb lasts 6x longer and saves about $6/year in electricity and generates 75% less heat lowering the lift cooling requirement of HVAC systems. Using a programmable thermostat, you can adjust the times you turn on the heating or air-conditioning based on a pre- set schedule. According to the Energy Star this method can generate 20 % savings. return

15 Logistics/Maintenance/ Telematics Environmental Defense Fund reports $700/ corporate vehicle annual savings from right sizing, proper maintenance, and efficient trip planning. ($2 billion in annual savings for commercial fleets.) Review logistics and load fill to maximize delivery efficiency. Utilize telematics to review driving habits and ensure timely maintenance can have a significant impact on your fuel usage and efficiency saves between 10-15% in fuel costs. return

16 Repurpose & Reuse UK retailer, John Lewis, is committed to a closed loop plastics recycling strategy. All packing materials, films, and worn out reusable carryout bags will be recycled into plastic boards and panels. Their diversion from landfill target is a 95% by the end of 2012. As a potential value ad, they are looking to use the recycled boards and panels in new store construction generating further savings through material re-usage. Book Reseller Generates $22 Million – In 2008, Better World Books generated more than $22.5 million in revenues and avoided $192,585 in disposal costs from the resale/ reuse of 5,255 tons of books and other materials. In addition to benefitting the environment, a portion of the proceeds from every book sold helps fund literacy programs around the world. return

17 Green Teams US Postal Service says employee green teams played a key role in helping USPS achieve the savings and revenue, which included nearly $12 million in vehicle fuel cost avoidance, more than $10 million in facility energy savings, water savings of nearly $1 million and a decrease in supplies spending of nearly $4 million. Additionally, green teams helped USPS recycle more than 253,000 tons of material, which saved more than $25 million in landfill fees. return

18 Recycling H&M launched a joint venture clothing recycling program in February of 2013 in conjunction with Global Green USA and I:Collect. Customers receive a coupon for 15% off there next purchase for each bag of garments donated. H&Ms strategy is to keep garments out of landfills by reusing the textile fibers. This strategy not only reduces waste but also provides an incentive to generate more sales. linklink According to Walmarts 2012 Global Responsibility Report, it diverted 81% of its US operations waste from landfill. The cost savings from the recycling effort contributed to the overall $150,000,000 in savings attributed to sustainable initiatives. return

19 Source List 1. Energy Star Web site. Accessed February 12, 2013. 2. US Department of Energy Web site. Accessed January 18, 2013. 3. US Small Business Administration Web site. Accessed February 15, 2013. 4. U.S. Environmental Protection Agency Web site. Accessed January 18, 2013. 5. Romm, J.J., & Browning, W.D. (1998). Greening the Building and the Bottom Line, Increasing Productivity through Energy-Efficient Design. Retrieved from Rocky Mountain Institute website: 6. Delmas, M.A., & Pekovic, S. (2012). Environmental standards and labor productivity: Understanding the mechanisms that sustain sustainability, Journal of Organizational Behavior. Published online in Wiley Online Library ( DOI: 10.1002/job.1827 7. Rheem, C. (2009). Going Green: The Business Impact of Environmental Awareness on Travel. Retrieved from PhoCusWright website: 8. Beyond energy savings: How green buildings can cut labor costs, September 2012. 9. Employees at green companies are significantly more productive UCLA, UCLA Newsroom web archive 10. 10 Ways to Slash Energy Cost. Energy Management Insight Role 2011.

20 Source List 11. Long -Term Growth, Short –Term Differentiation and Profits from Sustainable Products and Services: Global Survey of Business Executives, Report, 2012 12. H&M Kicks Off Garment Recycling Program, Environmental Leader, 2/22/13 13. Marlene Ringel and Baljinder MilesPuma Introduces C2C Certified Track Jacket, Backpack as Part of InCycle Collection, Sustainable Brands, 2/13/13 14. Stephen Kennett, UK Retailer John Lewis Closing Loop on Plastic Waste, Sustainable Brands, 2/8/13 15. USPS Green Teams Make $76 Million, Environmental Leader, 2/1/13 16. 2007 Annual Retail Trade Survey, Released 3/31/2009, US Census Bureau, 17. Sales Size of Retail Firms, National Retail Federation, 18. Hay Group study finds employee turnover in Retail Industry is slowly, 5/7/12, 19. Job Opening and Labor Turnover-January 2012, Bureau of Labor Statistics, US Dept. of Labor 20. Sustainability a Key Factor for Consumers: The Regeneration Roadmap Survey, Environmental Leader, 11/26/12

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