by Ed Weisberg
When Grocers made the shift from paper to plastic bags in the early 1980s, it was a boon to their bottom line. Plastic bags are significantly less expensive than paper bags, are stronger, and since they require less energy and use less resources for manufacture, actually have a smaller carbon footprint than paper. However, plastic bags have received a bad reputation from environmentalists, who are rightfully concerned about the number of bags that end up as litter in our waters and in our trees.
In an effort to mitigate waste and environmental impact, as well as reduce costs, bag manufacturers have endeavored to make bags thinner and thinner. Unfortunately, this results in less confidence by the customer that the bags are secure and an increase in register clerks doubling bags. Industry estimates are that 20% of grocery bags are doubled or damaged at the cash register. Thus the real cost and environmental impact of these bags has increased as retailers use more of these thinner plastic bags. In addition, rather than encouraging recycling, some communities have looked to ban, or charge for plastic and paper bags at the grocer.
What’s an environmentally concerned retailer to do? First and foremost, retailers need to encourage customers to recycle their bags. Recycling is the best way to cut down on waste, as well as eliminate the danger that littered bags pose to wildlife. But even better, with a long term perspective, retailers can save money, reduce their carbon footprint, increase the visibility of their sustainable message, and mitigate danger to wildlife by converting to COG-based degradable bags, such as ECOgrade Bags.
Fundamentally, COG-based ECOgrade bags bring many immediate advantages to retailers:
- They are made from an entirely new compound, called Calcium Olefinic Glucosate.
- If littered or lost, these bags degrade to a non-toxic residue within 240 days of exposure to sunlight, which can then further biodegrade.
- They are approved for recycling with plastics.
- They produce 34% less Greenhouse gas in pre-production, and use less energy in manufacturing than plastic or paper bags.
- They cost about the same, on a per bag basis, as plastic bags.
But in fact, there are many long-term and hidden advantages to ECOgrade even beyond this list. The largest cost savings is in the durability of ECOgrade bags. Since they are generally stronger, the need for double bagging, and the risk of splitting when packing standard grocery loads, is eliminated. This results in requiring approximately 20% fewer bags, which immediately improves profitability and reduces waste.
Beyond the costs savings, recent studies have proven the value of communicating a message of sustainability, and that customers will choose a sustainable company over the alternative. The Edeleman Goodpurpose ® study (2012) found that 73% of consumers would switch brands if a different brand of similar quality supported a good cause. Furthermore, the Nielsen Global Survey on Corporate Social Responsibility found that 50% of global consumers are willing to even pay more for goods and services from companies that have implemented programs that give back. What does this mean to retailers? It means that if you are a retailer that has competitors in your markets, and you clearly communicate your sustainability message with a product such as ECOgrade bags, almost 3 of every 4 customers who frequent your competitor’s store will be inclined to switch to your brand. If the market is split 50/50, that means that you could increase your customer base by 36%! Imagine what that does to your revenue and profitability!
In addition the consumer activities, recent studies by McKinsey, Deutsche Bank, and Harvard Business School/University of London have quantified the positive effects of sustainability activities on corporate value. McKinsey found that 39% of those surveyed believe that a clearly communicated sustainability message will increase a company’s value. The Harvard/University of London Study found that an investment in a value-weighted portfolio of high-sustainability companies would have outperformed low-sustainability companies by 46%, clearly indicating a return on sustainable behavior. Thus, not only will they gain more customers and save money, but the environmental message will resonate with investors to drive up market value.
The bottom line? Without any additional spending, a retailer or grocer has the opportunity to become more sustainable, help our environment, reduce costs, increase their customer base, and increase their corporate value. Is there any reason not to change to ECOGrade bags?
Edward Weisberg is Senior Vice President of Marketing and Business Development, GXT Green, Inc.