Today’s post is by Dave Wenig, Vice President of Sales and Services at SafeSourcing, Inc.
At SafeSourcing, many of our customers are retailers or provide products and services to retailers. As a result, we stay abreast of the changes that are either happening now or are likely to happen in that industry. We’ve written in the past about the impact of plastic bags and other changes that affect so many including retailers. But how exactly does a retailer make a decision to switch a product and what are the consequences of doing so?
Just like everything in life, change is hard. That’s true if you’re making a personal decision as small as trying a new hairstyle or something as big as deciding to uproot your family and take a chance on a new career. It’s no different when you’re thinking about switching from plastic grocery bags to an alternative.
As a quick note, the following examples are meant to illustrate the challenges, not to endorse or criticize any specific product types.
Circling back to plastic bags, it’s been announced that New York and Connecticut both have bans on plastic bags that will affect many retailers. Sure there are paper bags as a readily available alternative, but it’s not that simple. The legislation there also allows for fees to be charged to retailers for the use of paper bags. So, the retailers have options. They could consider whether they switch to paper and hope that on top of the higher product cost that they don’t also wind up paying fees. They could switch to reusable bag options and hope that the consumers will bear some of the burden of the process change. They can find environmentally friendly compostable bag options. As mentioned, the decision is made much more complex by the end consumers’ varying interests and needs.
Another recent example of change is in foodservice supplies. Surely you’ve seen some foam and plastic containers being replaced by compostable alternatives. One great example is the bowls in which you might receive your burrito bowls. It’s great that we’re able to either divert some waste from the landfills or at least replace the traditional products with a compostable variety that will decompose in a short period of time. The challenge in this case is that there are also potentially negative consequences that we’ll have to accept when we switch from a plastic or foam-based product to a product made from seemingly more eco-conscious products like fiber. The reason is that there doesn’t seem to be a consensus about what the chemicals required to produce these products will do to our environment and our bodies. It turns out that, in order to use the fiber and allow it to hold its shape while wet, we have to use some chemicals which might have negative health and environmental effects. Understandably, this puts a challenge on our customers who are in the position of making these choices. On the one hand, most people seem to understand that certain products are bad for the planet and will stay in the landfills.
One commonality between these two examples is that no matter what we decide to do about the the eco-conscious challenges many companies face, there will be consequences. Some consequences will be good such as a reduction in waste in landfills and an increase in positive public perception. Some consequences will be bad like higher costs for supplies and yet unknown impact on the environment or consumer health. The decision falls to the retailer to make. So, how do they make the decisions?
The answer depends on the retailer. At SafeSourcing, we see our retail customers falling into two main buckets relative to their eco-conscious strategies.
- Proactively eco-conscious. These retailers are on the bleeding edge of the market and likely have a strategy to become more eco-conscious and are adapting this as part of their branding. These companies are changing over to products that will reduce their impact on the environment sometimes even before legislation requires them to do so and are often paying a premium in supply expenses to do so.
- Reactively eco-conscious. These retailers do not have a proactive strategy to use environmentally friendly supply products. Instead, they will likely only change to an eco-conscious alternative if there are specific reasons to do so such as new legislation.
Regardless of which bucket the customer falls into, SafeSourcing has experience guiding the customer through the change. When on the bleeding edge of change, a Request for Proposal (RFP) might be in order to understand the types of products available in the market, the pros and cons or the different options, and the costs involved. That amount of information can help guide a decision where there is no legislation to rely upon and where there may be no references to call upon for review. If the customer is acting reactively, they are often able to rely more directly on SafeSourcing’s experience and leverage our specifications library to pick an alternative product specification that they would like to source. Of course, regardless of which bucket a customer is in or what type of product they need, a reverse auction or RFQ is always the best way to ensure that no matter what you buy, you’re getting it at the best possible price.
We have experience in dealing with all of these factors and approached and more. As time goes on, more and more of SafeSourcing’s customer base is either making the switch to eco-conscious products or considering whether and how they will. We work with both proactively eco-conscious and reactively eco-conscious customers, so no matter which bucket you fall in, we can help.
Contact SafeSourcing, Inc. if you need assistance on your own path to becoming eco-conscious. Change is hard, but it helps if you have someone to guide you.
Hines, Morgan. “‘Cancer-linked’ chemicals in Chipotle, Sweetgreen packaging? There’s more to know, experts say” USA Today. August, 13 2009.