2018 is the year of Sustainability in food retailing. Concern for food miles, packaging waste, organic grown and ethical are the buzzwords which consumers are seeking from their food experiences – and they are willing to pay for it. 72% of young consumers are willing to pay more for responsible low impact offering.
Sustainability is an opportunity to improve margins and reduce impact.
The operating carbon and cost footprint of food retail is three to six times higher than for non-food retail, with the food theme park style and burger bars featuring in the top end of the scale, which is likely to account for their presence at the front of the sustainability bandwagon.
Energy operating costs alone vary from $100 to over $300 per square meter which rapidly eats away at the profit margins of owners and the planet.
True “sustainability” is reducing environmental impact whilst improving profit which is good for society as a whole.
However, most food retailers are burdening themselves with unnecessarily high energy operating costs and causing themselves stress in the process.
Fig 1. Spread of retail carbon emissions by store type
In most cases, the operating energy cost and carbon footprint of food retail can be reduced by 35% or more if the right decisions are taken at the outset.
The top 5 decisions to ensure “best-in-class” carbon and cost footprint include:
- 10% can be avoided simply through selecting the right tenancy location and shopfront / layout design
- 5-10% through the selection and management of refrigeration
- 5% through the selection of equipment
- 4% through after hours automation and management
- 3-5% for lighting design (just because its LED doesn’t mean you can use unlimited amounts of it!).
Some of these decisions could cost a little more up front but generally, the energy savings achieved will pay back to operators within four to five months and leave them with an operating cost 30% lower than their competitors. Over a year, that could pay for an extra staff member or more social media and marketing.
Access to benchmark information (how do I stack up?) or low cost assessments (where do I get good cost effective advice?) has been a key barrier to uptake. Even more challenging is ready access to information about the best equipment and design features.
In the commercial office world, the NABERS rating scheme gives tenants a clear indication of the “sustainability credentials” of their fitouts. The Footprint Company is passionate about low footprint retail and with over 1,000 retail tenancy sustainability design assessments completed, so we decided to create our own Retail NABERS style benchmarks to help guide our designer / operator clients to achieve really sustainable results.
A small number of progressive landlords including Lend Lease, The GPT Group and Investa have been quietly supporting their retailers on this topic. These entities understand that retail tenants account for over 30% of all non-residential carbon emissions and believe it is an essential component of their corporate responsibility to engage tenants to operate better.