This is a unique moment in retail. Consumer demand for sustainable retailing is intersecting with corporate demand for more efficient supply chains.
Despite the juicy opportunity, retail sustainability still lacks both a literal and figurative hub. High tech has Silicon Valley, life sciences has Boston. So, where does retail sustainability fit on the map?
It’s Columbus, which stands on the cusp of capturing the ethos as another American epicenter of a global industry revolution.
Columbus is already a retailing capital in the US. With headquarters for the L Brands (including Victoria’s Secret, Bath & Body Works and Henri Bendel), Abercrombie & Fitch and Hollister, and Big Lots, Columbus has the retailing clout to not only create more sustainable supply chains, but influence the rest of the industry to follow suit.
From a retail experience standpoint, Columbus-based chains have long-led the pack. Victoria’s Secret was one of the first major chains to debut an e-commerce page, launching VictoriasSecret.com 15 years ago in 1998. Luxury department store Henri Bendel was early to the pop-up shop game in 2007 when it set up a blogger-curated gadget shop inside its 5th Avenue flagship during the holiday season. Always a step ahead of what shoppers think they want, Columbus brands face another opportunity to play leader.
A handful of recent studies validate the importance and future growth potential for retail sustainability:
- According to Cotton Incorporated’s Lifestyle Monitor™ data and 2013 Environment Survey, 23% of male and female consumers always or usually buy clothing marketed as “sustainable” – the second highest purchasing stipulation, behind only “Made in the USA.”
- The Road to 2020: Corporate Progress on the Ceres Roadmap for Sustainability, a 2012 evaluation of 600 U.S. companies conducted by sustainability advocacy firm Ceres, found that only 20 percent of retail companies have board oversight of sustainability.
- The Ceres evaluation also found that only 45 percent of retailers currently enforce green procurement policies.
Over the past few years, Columbus itself became a proponent for sustainability, launching its “Get Green” initiative in 2010: a three-pillar program focused on supporting the growth of green businesses, improving and conserving Columbus’ natural resources, and educating the public about green living. But city planning won’t be enough. The city’s robust private economy needs lead.
Given the city’s unique position as a global retail and distribution hub, Columbus has the opportunity to redefine the retail supply chain. Based on our experience with the industry and the city, here are a few tools and tactics that retailers should employ to carve out a Global Sustainability niche.
- Take an honest look at the current state of your supply chain. The only way to improve your operations is to know where they stand now. Developing and applying scorecards that grade all aspects of a retail supply chain – from material sourcing to supplier practices and even return processes – provide a full picture of where sustainable principles are lacking. Retailers can even automate these scorecards in order to conduct consistent checks on their supply chains.
One new, available tool is the The Higg Index, an indicator-based self-assessment tool developed by the Sustainable Apparel Coalition for apparel retailers to use to measure the sustainability of their products, processes, facilities and materials, identifying what areas need more attention.
- Plan for changes throughout your operations. Creating a sustainable supply chain doesn’t begin and end with reducing its carbon emissions. Proactive retailers will realize that sustainability starts with the source materials – not just what they are, but where they’re coming from, who’s supplying them and how they’re transported. Sustainability shouldn’t end with your distributor either; every step of the product lifecycle, from purchasing to returning (or even recycling!) should be treated as an opportunity for modification.
- Embrace technology as a sustainability tool. Most retailers have long been using digital technologies such as inventory management systems and warehouse management tools to make their employees more productive and efficient – but fewer have used them to make their businesses more sustainable. Through these existing tools, retailers can better monitor inventory to eliminate waste, unsafe materials, and the use of non-renewable resources. Using programs retailers already have in place, and the data they collect, distribution center floors can be reconfigured to make employee tasks safer or to maximize space.
- Be transparent. Once successful, sustainable upgrades are made to a retailer’s supply chain, make them known. Sourcing, manufacturing and logistics modifications that showcase a brand’s commitment to sustainability should be communicated to all of its audiences, solidifying what the new standard is and should be for retail operations. Visibility into the supply chain will create more confidence and trust in consumers, and signal to other organizations that not enforcing sustainable business practices is no longer an option.
While 2013 may still be an “early adoption” year for sustainable retail supply chains, it won’t be long until this awareness and transparency shifts from competitive advantage to corporate requirement. In true Columbus retail fashion, now is the time to take the lead.