Environmental awareness isn’t just for renewable energy companies and Silicon Valley startups.
In many cases, you can capitalise on the rising demand for sustainable living among consumers, regardless of what industry you operate in.
With human-driven climate change beginning to visibly affect our environment and ecosystems, public awareness and concern about environmental issues is rising. As a result, consumers and businesses increasingly value sustainability over traditional economic factors like price and simple utility. Besides that, sustainability inherently makes businesses more self-contained. This is important, because it gives businesses a more stable and predictable environment to work in in terms of energy costs and resource usage. The demand for sustainability, and the rapid development of green technologies has made many industries ripe for a green disruption.
Green consumers prioritise environment over prices
Consumers increasingly value environmental consciousness and sustainability over low prices. Moreover, more than half of polled owners of small and medium sized businesses in Australia reported that they value sustainability over maximising profits.
This is a big deal, because it marks a change in how businesses prioritise their operations. In the past, environmental factors have been treated as a secondary concern. By prioritising sustainability today, businesses can access markets and attract clients that businesses who only focus on competitive pricing simply can’t reach.
Sustainability networks support themselves
Businesses that are committed to prioritising sustainability need to monitor their entire supply chains to ensure that the materials they work with are also sustainably sourced. That’s a lot of work, but not if you happen to be one of those suppliers. Becoming one gives you access to clients that otherwise wouldn’t be interested in your products.
If you operate in an industry that doesn’t already have an environmentally conscious branch, you can fairly easily create it yourself. Sustainability is inherently a great selling point, and by leading the charge you’re providing additional value to client businesses and end consumers. With some encouragement, they’ll happily use your efforts to help sell their own products.
Sustainability reduces costs
An important misconception about being a sustainable business is that it’s inherently expensive. While environmentally friendly infrastructure and processes do tend to come with a larger up-front investment, they usually also reduce energy and resource consumption to a point that pays for itself. This is, in large part, because sustainability often creates compounding effects. For example, using energy efficient LED lighting doesn’t just reduce your energy usage for the lights. Efficient lights produce far less heat, which then drives down the cost of air conditioning significantly.
In terms of resource sustainability, businesses can benefit by “closing the loop” and recovering and reusing recyclable waste from customers. This is often more efficient than extracting resources from raw materials and brings down production costs while reducing environmental impacts.
Solar energy has arrived and puts you in control
Wind and hydropower have already been competitive for a number of years, but solar is now catching up. In 2016, solar power was a cheaper option for new energy installations than fossil fuels in 30 countries. This is especially relevant for businesses, because solar is one of the few energy options that businesses can install locally to generate their own power. Combined with new scalable energy storage options like the Tesla Powerwall, businesses no longer need to rely on dirty and sometimes unreliable third party providers.
Generating your own electricity is a big deal, because it makes your monthly energy costs entirely predictable. Financing a small private solar plant might mean paying a fixed monthly rate on a loan, but it also protects you from unexpected price fluctuations. As a result, you’re less likely to run into cash flow interruptions, and can afford to put any financial reserves held to manage potential issues or other uses. Now that solar is comparable to fossil fuels in terms of cost, there’s no question about what the better option is.
It’s an opportunity for SMEs
The catch with a lot of sustainable practices and business models is that they require a significant amount of restructuring and initial investment. For large businesses, existing infrastructure represents enormous sunk costs that they won’t be able to abandon because it hasn’t paid for itself yet. Maintaining and using their old systems might be less expensive for them than building new ones. This gives smaller enterprises the chance to outcompete much larger businesses by building a better business model from the ground up.
Sustainable businesses are rapidly becoming more efficient, and more popular with consumers, than traditional enterprises. By leading the charge now, small and medium sized businesses can displace existing industry superpowers to define the future of their industries, as well as their communities.