The Greening of Business ? How You Can Join the Hot, Cool Trend
Green is trendy.
From Wal-Mart and Home Depot to small mom-and-pop shops, businesses are concentrating on be environmentally friendly. While the idea of taking your product or business into greener pastures may seem difficult or costly, it ain’t necessarily so.
Green business – sustainable, eco-friendly or natural – operates in a way that conserves natural resources, eliminates waste and minimizes emissions and harmful discharges.
Any business can do it, says Karel J. Samson, an environmental and sustainable entrepreneurship specialist, and co-author of Spirit of Entrepreneurship (Springer, 2006, $79.95).
“Green,” “environmental” and “sustainable” are more than just labels, Samson says. They’re practices that include every aspect of business – invention, definition, construction, production and the ultimate disposal of the product.
Samson sees green practices as a natural extension of entrepreneurship’s focus on innovation. Small and developing companies can change faster than big corporations, bringing products and services to market quicker, he says.
And green sends an important message: “‘Doing good’ and providing quality and innovative products will be highly valued by potential customers if it is really authentic.”
Can Your Business Go Green?
Almost any product or service can go green, says Jason Trout of GreenBusiness.net, a forum for eco-entrepreneurs and professionals.
There’s no one way to do it, he says, but “literally thousands that companies can pick and choose from.”
For example, Working Assets, a multimillion-dollar business built on providing green phone service, donates a percentage of every charge to a social or environmental organization.
Jewelry stores can avoid environmentally destructive mining practices by using recycled gold. Green opportunities are endless.
“Google has greened its search service in many ways,” Trout says, “from increasing awareness of global warming on Earth Day through its home page artwork, to installing one of the country’s largest solar-power systems on top of the Googleplex.”
Cost and Benefits of Going Green
Nik Kaestner, of Green Squared Consulting in San Francisco, says green businesses improve their brand image, attract more new clients, see higher profits because of lower operating costs (utilities, waste disposal, etc.), and enjoy improved employee productivity, morale and retention.
“Green businesses also shield themselves from risks such as inflation in energy prices, increased insurance rates for companies that don’t consider their carbon footprint, and shareholder or community activism,” Kaestner adds.
Trout cites 3M’s Preventing Pollution Pays program as a great example of greening’s cost/benefits. “Not only have they prevented 2.5 billion pounds of pollutants from being released into the environment,” he says, “they’ve saved nearly $1 billion doing so.”
The costs of going green can be “minimal to non-existent if a sustainability policy is carefully thought out and cleverly implemented,” Kaestner says.
This is especially true if increased sales and productivity are factored into the equation, he explains, but these are often harder to measure and left out. Most environmental measures have a small up-front cost that’s more than offset by their extended savings:
“A green building might cost 3 percent more to build, but could save 30-40 percent on utility costs. A company might invest in reduced packaging and end up increasing sales because customers value the effort and choose that particular business.
“As more and more businesses go green, of course, the initial costs will shrink as economies of scale for new, efficient technologies start to kick in.”
Don’t Try to Be Greenish
Consumers are getting more sophisticated in their understanding of green, “so you can’t use smoke and mirrors, you must have a real green story,” says Allen Adamson, managing director of Landor, a brand consulting firm in New York.
You must ensure that your “green” product has a meaningful ecological benefit – a package that’s reusable or can be refilled, an appliance that uses much less electricity, not just 5 percent less, Adamson says.
And if a company says it’s going green, he advises, it should go all the way: “You can’t have your sales force drive hybrids while your management team drives Hummers.”
Green entrepreneurship specialist Samson offers this checklist for preparing to green your business:
- When brainstorming, define value as more than financial.
- Comprehensively define your product or service’s benefit not only to the customer, but to society and the environment.
- Eco-entrepreneurs not only create and sell, but build value-based communities. The greater the appeal, the more customer loyalty.
- Don’t preach, do.
- Define the green benefits of your product or service in realistic, deliverable terms.
- Start with a market segment, or create one, that appreciates both the immediate, direct value and the ecological benefits of your greening.
- You, the personality behind the business, can be part of what you produce and selling. Your personal authentic “green” image is cool. Both you and your business are the story.