Businesses are under pressure to become more eco-friendly, and this is because of a wide variety of reasons. The pressure may come from consumers demanding it in order to get their business, or it may be the government mandating it through various rules and regulations. Then there’s the urgency of climate change and the real need to make adjustments.
The issue is that many business leaders tend to focus on the costs involved. However, they should know that there are tons of benefits that extend well beyond doing something positive for the planet, and there’s a clear business case for being more eco-friendly. Here are 5 benefits of going green for medium and small businesses.
It Can Give You a Competitive Edge
These days, advertising yourself as being eco-friendly and following through with actual initiatives can definitely help your business stand apart in the marketplace. One study in particular found that customers were nearly 60% more likely to buy products or services if the organisation was green. Another study found that consumers will spend up to 20% more on environmentally sound products.
That means that sustainable products or low-waste manufacturing processes are a selling point that actually helps you sell more, and it is likely that you can pass on slightly higher costs to consumers. There is also a big difference depending on the demographics you’re serving, as waste tends to be a bigger sticking point with younger generations. As a matter of fact, one survey reported that 60% of Millennials would pay more for an eco-friendly version of a product or service.
It May Open Up Investment Opportunities
Sustainability is seen as the wave of the future, and more than half of executives interviewed by CFO Research said that they’ll increase their revenue through sustainability measures. More importantly, sustainability has become a factor that companies are graded on by investors and institutional investors. Your business may have to have measurable progress toward sustainability goals if you want to receive major loans, sell stock or keep the current share price high.
Another area where being eco-friendly could help is when trying to form partnerships. Some businesses will refuse to partner with companies that don’t have a clear green agenda and procedures. In other cases, you might end up limiting your sponsorship opportunities.
It Could Help Your Business Save Money
One of the biggest side benefits of being eco-friendly is being able to reduce your operational costs and improve your firm’s bottom line. Every pound you don’t spend counts toward your profit margin, and going green could help you increase profits without having to focus on getting more sales. Reducing your energy costs, for instance, could make a huge difference on your margins, and help you stay afloat if your sales are dwindling.
Energy efficiency projects tend to have a high return on the investment and a fast payback period. Replacing light bulbs and installing smart thermostats pays off faster in a large business than it does a private home. For example, installing motor control centres and sensor networks may allow you to create optimised operational profiles. Now you get the same output for less power, and you may notice potential problems and fix them before major breakdowns occur.
Another thing you should do is keep an eye on your water consumption. Some of the things you could do to keep your water consumption to a minimum would be to ask your employees to use a low flow flush option, report leaking taps, and run the dishwasher when fully loaded if you happen to be in the food industry. These behavioural modifications have almost no cost but will have significant benefits.
You should also review your cleaning schedule, and reassess the methods you’re using. It may be better to sweep driveways than hose them down, and use pressure washers only when you have no other choice. Or, you could save water and time by washing things down less often.
Another thing you could do to improve your water efficiency is to perform a water audit. If you want to learn more about saving water in your business and want to take actionable steps starting today, you can start saving water through these methods.
Also, try to look for savings inside and out. For example, finding out how much water your plants really need may allow you to cut sprinkler usage in half without hurting your landscaping. You may take things further by replacing the existing landscaping with low-maintenance plants.
It Prepares You for Potential Regulatory Changes
South East England is facing a water shortage, and the situation is much worse than many in the general public can imagine. To counteract this, the government has been increasing water-efficiency rules in an effort to prevent shortages.
There are also major financial reasons to do so. Building new desalination and wastewater processing plants is expensive, and would cost taxpayers billions of pounds, so it’s essential that they compel companies to do their part as well to reduce their usage. They have tons of different ways that they can do so as well.
For instance, the government could ramp up water and wastewater fees to encourage conservation and raise money for new infrastructure. Utility companies might raise their electric rates to help pay for new power plant construction as well. Eventually, we can expect to see new sustainability standards intended to curtail resource usage so that supply can meet demand.
Sustainability and conservation efforts can help companies meet carbon emission reduction standards that are on the horizon as well. That’s why you need to begin researching ways to reduce energy and water usage now, because you may have to reduce resource usage by 50% in 2050.
You May Get a Happier, Healthier Workforce Out of It
Corporate social responsibility is increasingly considered a pillar of an ethical culture, and sustainability is part of that. Employees are also more critical than ever when it comes to the companies they will choose to work for. As a matter of fact, one survey showed that nearly three-quarters of adults said they would not work for a company that damages the environment.
On the flipside, a more eco-friendly workplace can contribute to a happier, healthier workforce. Increasing the amount of natural light has been shown to lift morale, for instance. Phasing out artificial chemicals in your cleaning supplies could reduce rates of asthma and migraines. More natural ventilation will reduce energy costs while eliminating the stuffy feeling that drives many to leave as soon as possible.
Increased ventilation will also curtail mould and allergens in the air. This reduces how many times people feel ill at work, and days off that they take as a result. Having a clean and chemical-free environment will do more to boost morale than any team building event you can hold, so focus more of your energy on trying to give them an environment they’ll feel comfortable in and that will not literally make them sick.
Taking steps to make your business more eco-friendly is more than a moral obligation. Not only could it make a real difference, but it could pay off for your company in a variety of ways.
CONTRIBUTED BY GRACE MURPHY