Can retail be sustainable? Learn from the brands redefining the industry with our sustainable retail guide
Some commenters say it’s never possible to be a sustainable retailer.
What do you think?
Retail is an industry that’s built from supply and demand, meaning business hinges on economies of scale. Consumerism fuels the production engine, yet this machine of build-buy-bin is running at a rate our planet cannot support.
For example, in the United States, 2020 saw ~2.63 million tons of returned merchandise dumped as landfill waste. Which is 16% higher than the previous year. Greenhouse gas emissions (GHGs) have also increased over the years, reaching 16 million metric tons of C02e.
Yet, there are brands across the world making a difference and redefining what it means to be a successful retail business. These brands have built a robust model, one that delivers value across the triple bottom line of people, planet, and profit.
At the Green Business Bureau, we see these brands and the difference they’re making. We wanted to take the time to not only acknowledge their work, but to also learn from their successes, as we know the power of sharing ideas, learning together, and inspiring each other.
And so, we’ve assessed the business landscape and identified 40 initiatives to create our sustainable retail guide.
To produce this guide, we’ve listened to people like you – the leader, executive, employee, and consumer – to find out what your pain points are. And with this in mind, this guide will address the top 6 challenges retail brands may face as they evolve into a sustainable business.
The Green Business Bureau is here to support you, to help you create a purpose-driven organization that gives back and delivers a better world for our children. After all, who wouldn’t want that?
We want sustainable retail. Let’s make it happen
- 53% of brands stated that improving sustainability is a top priority;
- 40% of brands are investing in more sustainable packaging;
- 60% of brands are launching products with a positive environmental or social impact;
- 41% of brands are investing in transparency to effectively communicate their sustainability vision and goals.
Changing stakeholder expectations has sparked this shift. For instance, 44% of consumers are more likely to choose a brand with a clear sustainability commitment (after having assessed product quality and price). In addition, 35% of brands are investing in sustainability and social causes to improve employee recruitment and retention.
Hence, the market is changing. Retailers! You must not fall behind.
6 challenges the sustainable retailer faces
Sustainable development in the retail sector comes with a unique set of challenges, and the Green Business Bureau has summarized these below:
- Challenge #1 – lack of trust: It’s difficult to accurately showcase an organization’s sustainability achievements, avoid greenwashing and establish consumer trust in a cynical market.
- Challenge #2 – lack of standards: There’s no hard-set definition for sustainable retail. There’s a lack of universally recognized parameters to measure retail sustainability.
- Challenge #3 – many consumers don’t care: Consumers want sustainable choices, yet there remains an attitude-behavior gap. Consumers make a choice based on their assessment of product design, quality, price, and then sustainability.
- Challenge #4 – upfront investment required: Sustainability is a long-term strategy. Retailers have to make investments today to orchestrate lasting business value. This is especially difficult for discount/value end brands.
- Challenge #5 – conflict of interest: Let’s address the elephant in the room. Traditionally, the retail market thrives from excessive consumption, and so marketing messages are tailored to drive this consumption. The sustainable retailer has to tell consumers to buy less, which is challenging for business models that leverage economies of scale.
- Challenge #6 – complex supply chains: Retail outlets are a single node in a complex value chain, connected by diverse relationships between many stakeholders. This makes it difficult for one retailer brand to have a positive impact on the entire web of operations. Supportive and collaborative relationships, with a multitude of stakeholders that share a similar vision and values, are what’s needed.
Solutions to the challenge of creating sustainable retail
Our sustainable retail guide gives 40 actionable initiatives to mitigate the six main challenges a sustainable retail business may face. That is:
- Building stakeholder trust: We detail how you can effectively and accurately communicate your achievements, establish consumer trust and avoid greenwashing through storytelling, green business certification, and by leveraging your digital assets (e.g. social media, websites, and blogs).
- Defining retail sustainability: Our guide acts to define sustainability in retail.
- Creating additional value for customers: Our guide illustrates how sustainability can create additional value for your customers, on top of having a well-designed, high-quality product. In this sense, sustainability is a unique selling point.
- Introducing low and high-effort initiatives: Our sustainable retail guide presents low-effort initiatives along with longer-term solutions. You can kick-start your sustainability journey straight away with low-hanging fruit, while you work towards goals that demand more effort but deliver lasting value.
- Building value from minimalism: You’ll build a brand that promotes minimalism over consumption, following the footsteps of successful international retailers who have championed this shift.
- Creating a sustainable value chain: Our sustainable retail guide details how you can work with multiple stakeholders to support sustainable development, and how you can reduce the environmental impact of your value chain.
Each initiative in our sustainable retail guide is not designed to work in isolation. One initiative will have compounding effects across your business. That is, a single initiative will support a multitude of other initiatives. As you progress, the returns from your efforts will be amplified.
Sustainable retail guide checklist
Below we’ve detailed our sustainable retail guide checklist for your review.
Building design, construction, and retrofit:
Initiative #1: Design buildings for the long term
Initiative #2: Design for climate change resilience
Initiative #3: Incorporate recovery materials into the building design process
Initiative #4: Use materials and products as efficiently as possible
Initiative #5: Source from responsible suppliers
Initiative #6: Procure building materials and resources locally
Initiative #7: Select materials with a low VOC content
Initiative #8: Measure embodied energy and carbon emissions
Initiative #9: Assess your building’s impact with environmental assessment methodology
Retail store emissions and carbon footprint:
Initiative #10: Minimize energy used for lighting
Initiative #11: Efficiently control internal temperatures
Initiative #12: Close the door
Initiative #13: Utilize energy-efficient equipment
Initiative #14: Measure, report and reduce business scope 1 emissions
Initiative #15: Measure, report and reduce business scope 2 emissions
Initiative #16: Measure, report and reduce business scope 3 emissions
Initiative #17: Offset remaining GHG emissions
Initiative #18: Measure and monitor water consumption
Initiative #19: Identify and manage water leaks
Initiative #20: Retrofit bathrooms and breakrooms with water-efficient equipment
Initiative #21: Implement an effective waste management system and aim for zero waste
Initiative #22: Implement an effective inventory management system
Initiative #23: Minimize packaging waste
Products and services:
Initiative #24: Offer sustainable products
Initiative #25: Measure and score the sustainability performance of your products
Initiative #26: Implement a buyback, repair, and recycling program
Initiative #27: Develop a sustainable supply chain
Initiative #28: Measure and offset supply chain scope 3 emissions
Initiative #29: Reduce emissions from the transportation and distribution of good
Initiative #30: Go paperless
Initiative #31: Go digital
Initiative #32: Implement lean process design
Stakeholder communication and support:
Initiative #33: Support the local community
Initiative #34: Support your employees
Initiative #35: Mobilise your team and create a green culture
Initiative #36: Be transparent
Initiative #37: Collaborate
Initiative #38: Give back to the environment
Initiative #39: Tell your sustainability story
Initiative #40: Get certified
The sustainable retail model
The sustainable retail business delivers long-term value to the consumer. High-quality products are made to last, creating a system that promotes minimalism over consumerism. This is a model that also leverages the idea of a circular economy, using the 3-R concept of reduce, reuse, and recycle. Sustainability is championed at the core of the business, rallied by an organization’s green culture. As such, sustainability fits seamlessly into the brand’s story, with achievements communicated accurately and together with an organization’s environmental and social challenges. The sustainable retail business will look to collaborate across its entire value chain, to engage each stakeholder in sustainable development. And this development is viewed as a continuum of improvement, beginning with low-effort initiatives that work to drive momentum and fund higher-effort but higher-return progress. In addition, employees and communities are supported using a people-focused approach to business.
With strong social and environmental pillars, economic success is bolstered. Hence, the sustainable retail business is a robust retail model designed for the future.