Article courtesy of our Dallas-Forth Worth B2B CFO® Partners…
Traditionally, business and the environment have been seen as arch enemies but the truth is implementing environmentally friendly initiatives is actually increasing the profitability and public image of many large companies. But, can it work for small and medium-size businesses?
Success stories are rampant for big businesses. Walmart is a great example. In 2010, the company saved $231 million due to recycling and the decreased expenses of sending waste to landfills. While this number is astonishing, the impact can be just as big percentage wise for smaller companies who use creativity.
In 2009, the State & Allen Lounge and Restaurant in Dallas recycled 67,604 tons of materials and saved money on vegetable purchases by providing vegetable scraps for compost in exchange for fresh vegetables. This not only saved them money, but earned them the Mayor’s Environmental Excellence Award and the resulting good press. In San Antonio, one Holiday Inn saved $78,000 in a year on water bills after taking advantage of a “no cost“ city program that replaced toilets and shower heads with lower water consumption models.
So how can your company increase its profitability with green initiatives? The first step is to analyze your business to determine which resources it is using or impacting the most. It’s also a good idea to check in with state and local governments to research environmentally friendly incentive programs that help businesses get started for free or at a reduced cost. After a general assessment is completed, cost saving matrixes need to be created to determine how much money can be saved and how long it will take to recoup any upfront investments. This step is where a financial executive can be of assistance.
To get started, here are 10 green ideas to consider that could reduce your expenses and increase your profitability.
1. Embrace Alternative Fuel and Hybrid Vehicles –While this can be an expensive investment, companies can take advantage of government grants to make it affordable initially and then save on fuel costs over time. For example, the Texas Commission on Environmental Quality recently announced that $5.7 million in grants are available to eligible individuals, businesses, governmental entities, and school districts, to replace older diesel vehicles with new alternative fuel and hybrid vehicles.
2. Switch from PC’s to Laptops – By allowing employees to use laptops, companies can reduce their power consumption because laptops can utilize battery power for some of the time.
3. Allow Employees to Work at Home – The biggest secret large companies have discovered in recent years is that allowing employees to work from home not only reduces carbon emissions but saves companies money on office space and electricity.
4. Switch to E-bills and On-Line Catalogues and Promotional Materials – With today’s technology, cutting down on paper usage has never been easier. Many companies are switching to e-bills and eliminating or reducing expensive printed materials, which also saves postage.
5. Add Energy Saving Equipment during a Remodel or New Construction – Companies can save millions of dollars over the lifetime of a building by using green building designs and equipment that saves electricity and fuel, such as skylights, tankless on-demand water heaters and radiant floor heating. To take it a step further, consider installing solar panels and wind turbines. Some private companies are offering free installation in exchange for a contract to provide reduced cost electricity for a certain period of time.
6. Install Water Recycling/Reduction Equipment – Large consumers of water can save money by installing water recycling equipment or reduced water consumption toilets, water faucets and shower heads. Many companies are also installing equipment that allows them to reuse and recapture water. Even simple steps can be taken like using air conditioner condensation to water landscaping.
7. Install a Smart Grid - This system predicts and intelligently responds to the behavior and actions of all electric power users connected to it. The grid saves money and time by turning on and shutting off IT components according to their need at any given time.
8. Divert Waste from Landfills to Recycling Centers – By sending/selling used boxes and materials to a recycling center, companies can significantly reduce their garbage collection costs.
9. Purchase Lower Cost Recycled Materials – Many recycled products can be made and purchased for a lower cost. For example, the recycling company Anza is helping African farmers increase their incomes by 50-100% a year by selling them recycled materials.
10. Utilize More Efficient Light Bulbs and Thermostat Controls – Almost every company can save electricity by replacing traditional light bulbs with compact fluorescents, turning off lights after hours and installing equipment that automatically adjusts office temperatures.
These are just a few of many ideas to consider. The important thing to remember is to do research and run the cost projections upfront. By planning ahead and using solid research and cost comparisons, a business executive can direct company efforts towards the programs that maximize the positive impact on the environment and their public image – and their bottom line.
If your company needs help analyzing the savings it could achieve from implementing environmental sustainability initiatives, B2B CFO® can help. For more information, contact me at (510) 676-4397 or at email@example.com.