Retailers pondering what ‘going green’ should mean, study says

Retailers are digging deeper to determine what they must do -- and what they are willing to do -- to be more eco-friendly, despite dwindling pressure from consumers to be green.
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Finally convinced that it’s good to be green, retailers are now getting down to the nitty-gritty of what it takes to be eco-friendly, despite dwindling consumer demand for green products, according to a November report from Retail Systems Research.

“We saw in last year's report an increased interest in store-based green initiatives, and that continued very strongly this year,” Steve Rowen, managing partner at RSR (www.retailsystemsresearch.com), said in a statement.

In 2010, 61 percent of surveyed retailers said that green initiatives “make good business sense,” as opposed to 49 percent in 2009, according the report, “Lean and Green: Sustainable Practices Are Changing Retail, Benchmark 2010.” The report includes responses from 95 retailers surveyed in the fall of 2010.

While the report shows that retailers remain interested in green initiatives, fewer of them place a high priority on making their entire supply chain more eco-friendly.

In 2010, only 39 percent of retailers said they place a high priority on greening their supply chain, which is down from 51 percent last year.

“For all but the largest and most powerful retailers of the world, many of the eco-related details of these functions lie beyond their control,” the report stated.” However, RSR said this indicates that retailers have examined their sustainability initiatives more closely, and they are now identifying the most effective strategies.

“More retailers are further along in a true overhaul process,” the report stated. Retailers have realized they can do more good by reducing their own energy costs through things such as better heating and cooling systems. They’re even replacing old IT devices with those that are more energy efficient.

According to the study, retailers are also identifying the critical obstacles to becoming more eco-friendly, and survey respondents said that existing technology and infrastructure are primary roadblocks.

“It confirms that retailers are taking green seriously,” the report stated. “They’re not hung up on deciphering if there really is a cost savings available via leaner systems, and instead, have moved on to the difficult -- yet worthy -- task of making those systems leaner.”

Consumer pressure dwindles

The report also revealed another interesting shift. In the past, many retailers pursued green initiatives due to pressure from consumers, but consumer demand appears to have ebbed.

“Retailers feel less obliged this year to pursue green initiatives as a result of consumer demand, as only 52 percent say ‘our customers expect us to act,’ down from 62 percent in 2009,” the report stated.

In 2009, 58 percent of retailers reported that customers were not yet demanding greener products or stores, and in 2010 that figure rose to 66 percent.

However, the survey showed that the country’s best performing retailers are pressing forward with green products and initiatives despite the drop-off in consumer demand.

“The best performing retailers clearly understand that, even as they wait in frustration for the customer to ‘come around,’ there remains an opportunity to help get him and her there,” the report stated.

RSR advised retailers that, “Promoting the green steps they’ve taken and the products they sell is well advised.”

--Marcus Woolf

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