Retailers are under considerable margin pressure, so you
would expect them to take any measures possible to reduce cost. Much work has focussed on labour
productivity, or getting more sales per staff person, for example by
introducing self-checkout. However there
is still much to be done on resource productivity.
A recent data set on leading retailers’ greenhouse gas
emissions, sales, and employee numbers shows a wide variation in labour
productivity and sustainability.
Interestingly, the most labour efficient retailers are also the most
emissions efficient – no company is just “green” or solely focussed on
automation or scale.
CVS (a pharmacy retailer) and Costco (a warehouse club)
exceed their peers on both measures, but amongst the others there are some
interesting differences. Walmart and
Tesco do not achieve the labour productivity of Kroger (a leading US
supermarket), but both are significantly more efficient on greenhouse gas
emissions. This is probably no accident –
both Walmart and Tesco have made bigger commitments to reducing emissions.
Tesco aimed to reduce energy use by 50% from
2000 to 2010, versus Kroger’s target of a 30% reduction over the same
period. Walmart gave themselves just 4
years to achieve a 30% reduction (from 2005-2009), and they aspire to supply
their stores with 100% renewable energy.
There are big savings for retailers who make efficiency
their priority. Improved lighting
systems, daylighting, energy controls, heat recovery, behavioural change, and
many other approaches can reduce costs significantly, often with a 2-3 year
payback period. For any firm in the
retail sector, sustainability in terms of a reduced carbon footprint should have
a leading role in their effort to thrive in these challenging times.
