Sustainability

From Green Produce to Green Programs

Janet Groeber — Wed, 01 Feb 2012 05:22:41 +0000

Air curtains, LEDs and solar panels green up Market of Choice stores

S hoppers seeking organic foods and sustainable goods naturally want the stores they shop to be green as well. Market of Choice, based in Eugene, Ore., is a family-owned chain of eight grocery stores with an energy strategy that’s a model of conservation efforts.

President and CEO Rick Wright, son of founder Richard Wright, recently told the Northwest Energy Efficiency Alliance’s BetterBricks that his company is “committed to energy efficiency because we really want to be more sustainable, and because it’s smart financially — natural gas and electricity aren’t going to get any cheaper. We’ll spend the extra money up front to get the most efficient stores and reduce the stores’ demand for energy.”

Among the methods Market of Choice has used to reduce its energy consumption by 15 to 20 percent are employee training and routine equipment maintenance. The company also installed ceiling fans to circulate warm air from the ceiling to the floor, and its Green Waste Program diverts materials from local landfills by composting organic food waste on site.

But there are more capital-intensive efforts, like replacing outdated refrigeration with more energy-efficient units, which offer the best rate of return. “New cases are about 58 percent more efficient than the old,” Wright told BetterBricks. “The power savings, utility incentives and tax credits can yield two- to three-year paybacks.”

A bright idea
Another major energy conservation program is Market of Choice’s transition from high-intensity discharge (HID) and fluorescent lamps to watt-sipping LED lighting in produce sections and reach-in coolers and freezers. Market of Choice typically uses energy-efficient refrigerated cases by Hill Phoenix with fluorescent lighting; the lighting change-out program replaces conventional lamps with drop-in LEDs that use half the wattage, but offer equal or better luminance.

The program started with the chain’s Franklin Street store in Eugene and will likely roll out to other locations, says Scott Cook, Market of Choice’s sustainability coordinator. LEDs aren’t affected by moisture or extreme temperatures, don’t use environmentally damaging mercury, cut energy usage by 60 percent, emit less heat for the refrigeration system to dissipate, are brighter, have a five-times-longer lifecycle than fluorescent sources and offer a payback in five years, Cook says.

Produce sections in most Market of Choice stores will be receiving LED drop-in lamps in HID 42-watt fixtures. The HID change-out program is based on the success of the 160-fixture retrofit at the Willamette Street store in Eugene.

Letting the sunshine in
Since 2009, Market of Choice has been using 562 rooftop mounted SolarWorld 175-watt photovoltaic solar modules to generate electricity. Its Willamette location in Eugene produces solar energy with a 30.8-kilowatt photovoltaic (PV) system, one of the largest in the city.

A PV power inverter by Power-One connects the 130.0 kW DC system to the electric grid. Market of Choice sells the power to Oregon’s largest customer-owned utility, Eugene Water & Electric Board, which pays 12 cents/kWh on the 10-year contract. Market of Choice trumpets the efforts on its website in the form of simulated electric meters that show ongoing daily solar power generation statistics. Over the system’s lifecycle, it will save 2,800 tons of CO2 emissions vs. fossil fuel-based electric generation.

Beyond its stores, Market of Choice’s corporate offices are also using solar lighting generated from solar tracking skylights. A monitor/control system adds lumens of artificial light when solar lighting isn’t sufficient near dusk, dawn or on overcast days.

Cutting down on drafts, lowering costs
Several years ago, when both customers and employees were feeling chilled from drafts, air curtains were installed on the front and shipping doors at seven stores. Originally aimed at indoor air comfort, the stores have since experienced increased energy savings while reducing flying insect infiltration — an added benefit.

Most stores have stainless steel air curtains manufactured by Berner International. An air curtain employs a controlled stream of air aimed across an opening to create an air seal. This seal separates different environments, while allowing an unhindered flow of traffic and unobstructed vision through the opening. The air curtains are activated by a limit switch triggered when the door opens and deactivated on a five-second delay setting via Berner’s digital programmable Intelliswitch controller.

Joe Banas, national sales manager of Berner International’s food service division, says air curtains have “been in use for years on back door shipping areas for sanitary reasons.” More recently, he says, as energy costs have climbed, chains like Whole Foods Market, Lowes Foods and dozens of others have become interested in using air curtains to reduce the amount of energy lost through the front door.

Market of Choice’s sustainability efforts are proving to be winners both operationally and with customers. The grocery has remained popular and profitable throughout the recent economic downturn; last November the Willamette location received the 2011 “Food Service Trashbuster Award” from the Lane County Board of Commissioners and its Resource Recovery Advisory Committee. The award recognizes individuals, organizations and businesses for their efforts to reduce wasted resources, contributing to the health of the local community and the economy.

Saving Receipts … and Trees

D. Gail Fleenor — Thu, 01 Sep 2011 05:22:41 +0000

Paperless solution allows targeted couponing, messaging

Receipts, an integral part of retail transactions, remain one of the last holdouts in the push toward a paperless society. Several companies are working toward an online receipts solution that will also provide information for retailer marketing.

Birame Sock, founder and CEO of Third Solutions, says her idea for a digital solution was “driven by a selfish idea — to get all my receipts online.” Banks have information on what is spent, she says, but not the particulars of expenditures. Sock decided to make this information available with MyReceipts, a division of her Miami Beach-based company.

With MyReceipts, retailers digitize transactions using an existing loyalty card or the customer’s phone number as an identifier. At checkout, the customer swipes her loyalty card or provides her phone number and the receipt is sent to the user’s MyReceipts page. Based on customer purchases, retailers can issue targeted coupons at checkout or via e-mail to the user’s MyReceipts page. Before a shopping trip, customers can visit their online page and view coupons to make a list.

Targeted messaging
While paperless receipts can be used in any type of retail setting, Sock says the grocery sector is an early adopter due to more frequent purchases by customers, longer receipts and standardized procedures already in place.

Whole Foods Market is testing the solution at two stores in the Washington, D.C., area. “The pilot has been extremely successful,” Sock says, noting that discussions are underway with the grocer to deploy MyReceipts company-wide. Several other supermarkets will be deploying the solution in the next few months, she adds.

Benefits for retailers begin with savings on paper, ink and manpower and include gaining “a better sense of which customers shop stores,” Sock says. Offers and messages based on shopper information from MyReceipts can be more targeted and, therefore, more successful, she says. Other uses include rapid delivery of product recall information and detailed coupon redemption reports to participating retailers.

Other features currently being developed include receipt organization, a calorie counter, warranty details, nutrition and product information. MyReceipts is also available on select mobile phones, allowing customers to pull up coupons while in-store.

Built to suit
MyReceipts also supports online transactions and loyalty accounts from retailers like Best Buy, Wegman’s, Walmart and Office Depot.

The platform was designed using retail standards (Third Solutions is a member of ARTS, the NRF division devoted to developing such standards).

Sock, a native of Senegal, moved to the United States in 1993 to attend the University of Miami. She has worked as vice president and senior project manager for tech companies and was a 2010 winner of a Cartier Women’s Initiative award.

“The main message here is that if retailers are concerned about paperless transactions and wondering if they should build a solution themselves, this is not necessary,” she says. “We have built the most efficient solution cost-wise. It is still early in the process [but] we are the leading solution today. We just ask retailers to work with us and we will build to suit their needs.”

The Big Chill

Janet Groeber — Mon, 01 Aug 2011 05:22:41 +0000

Sprouts Farmers Market installs a green refrigeration system

Retailers are steadily embracing sustainability — perhaps none so much as supermarkets, particularly purveyors of natural and organic provisions. In California, the new 28,000-sq.-ft. Sprouts Farmers Market store in Westlake Village has received the EPA’s GreenChill Platinum Award for its state-of-the-art green refrigeration technology. The system is expected to reduce the store’s total carbon footprint by 2,417,000 pounds over 10 years — the equivalent of removing 215 cars from the road for a decade.

According to GreenChill, a majority of the more than 35,000 supermarkets in the U.S. use centralized direct expansion (DX) systems to chill their products. Typically, these refrigeration systems are charged with 3,000 to 4,000 pounds of refrigerant and can leak more than 20 percent of their charge each year.

The Westlake Village location, which opened in May, is Sprouts’ eighth GreenChill-certifed store. Sprouts selected Hill PHOENIX of Conyers, Ga., a designer and manufacturer of commercial refrigeration equipment, to develop a new system for the Westlake store in collaboration with Sprouts’ construction and facilities engineering team.

CO2 technology
GreenChill Platinum certification requires that stores achieve an average HFC refrigerant charge of no more than 0.5 pounds of refrigerant per 1000 BTU per hour total evaporator cooling load and a storewide annual refrigerant emissions rate of no more than 5 percent.

“The main goal … was to reduce the risk of leaking harmful HFC into the atmosphere, and secondly, to reduce the cost of our initial refrigeration charge,” says Jerry Stutler, Sprouts’ vice president of construction and facility engineering. “And finally, we wanted to reduce our potential exposure to costly catastrophic leaks in our systems.”

Hill PHOENIX’s solution, dubbed Second Nature MT2LX, features a full CO2 cascade system for both low- and medium-temperature applications. It is one of the most environmentally responsible refrigeration systems available in the industry today, says Henry Pellerin, Hill PHOENIX’s director of marketing programs.

Second Nature MT2LX also represents the next step in CO2 refrigeration technology. CO2 is used as a secondary coolant for the medium-temperature system and as a direct-expansion cascade refrigerant for the low-temperature system. Since the HFC refrigerant is confined to the primary system (located in the machine room), the total refrigerant charge and the potential for leaks are greatly reduced.

Other advantages include CO2’s low cost and wide availability, as well as the fact it’s considered a natural refrigerant with very low global warming potential. Additionally, lines required for CO2 transport are typically one to two sizes smaller than traditional DX piping systems, reducing the weight of installed copper lines by at least 50 percent while also reducing installation costs.

The Hill PHOENIX cascade systems consist of two independent refrigeration systems that share a common cascade heat exchanger. The upper-cascade system is a reduced charge HFC system that cools the CO2 in the lower cascade. The HFC system rejects heat to ambient through an air-cooled, microchannel condenser.

“It was really important that we were able to utilize air-cooled condensers,” says Tom Kilroy, an inside sales engineer at Hill PHOENIX. “Nobody in the industry really thought that you could earn a Platinum Certification with air-cooled condensers. Otherwise you would need a separate condensing loop, pumping station and an expensive fluid cooler on the roof.”

The size of the equipment installed at Sprouts fits in the same area as the traditional systems used in older stores. “We’re containing the refrigerant in the back room [as opposed to the sales floor] where it’s easier to detect HFC refrigerant leaks,” Pellerin says. “This adds up to decreased refrigerant costs, decreased risks and costs associated with refrigerant losses as well as decreased maintenance costs.”

Image enhancement
When it comes to ROI, Pellerin says, Hill PHOENIX’s customers “justify the investment in our Second Nature technology by looking at maintenance and installation costs.” With Second Nature systems, he says, “the simplification of the system gained through engineering innovations results in fewer potential mechanical problems.”

“It’s tough to put a dollar value on the potential payback for this investment,” Stutler says. “If we had a catastrophic leak in our old system, we could have leaked 2,000 pounds of refrigerant. …With today’s system, we only have the potential to leak 235 pounds of refrigerant.

“Certainly we’re hoping to save money over the years,” he continues, “but how do you put a dollar amount on the value of being green, reducing your carbon footprint and improving the overall system performance?”

Brand and image enhancement as the result of reducing its carbon footprint, competitive differentiation and being the first store in a market to utilize and leverage new technology are all less-tangible factors operators might want to consider. “Sprouts did a great job communicating these benefits to customers with their in-store marketing initiatives,” Pellerin says.

The Westlake Village Sprouts store “represents many firsts,” says Keilly Witman, manager of EPA’s GreenChill Partnership. “The first CO2 cascade system to achieve platinum, the first platinum store west of the Mississippi and the first time a store was designed from the ground up to achieve GreenChill standards.

Good Day Sunshine

Janet Groeber — Fri, 01 Jul 2011 05:22:41 +0000

Renewable energy initiatives reduce IKEA’s carbon footprint

Since its founding in Sweden nearly 70 years ago, IKEA has offered low-priced home furnishings of good design and quality. Its warehouse-like stores feature room vignettes displaying IKEA-designed full kitchens, living and dining rooms, as well as bedrooms with furniture and closet systems that IKEA sells ready-to-assemble. There’s also a “marketplace” with home accessories.

Privately held IKEA, a global player with more than 300 stores in 38 countries, takes sustainability seriously. In February, IKEA announced plans for a nine-turbine wind farm in Dalarna County, Sweden, that, when completed, will bring IKEA closer to its goal of 100 percent renewable energy powering, heating and cooling its facilities in that country. At full capacity, the wind farm is expected to generate enough electricity to power the equivalent of 17 IKEA stores.

IKEA began the transition to renewable energy in 2009 when it purchased three wind farms in France, and quickly followed that with the 2010 acquisition of six German wind farms. The company now owns 52 wind turbines that generate approximately 10 percent of its total energy requirements.

Long drawing from a desire to minimize its operations’ impact on the environment, IKEA believes it can be a good business while doing good business. Globally, IKEA evaluates locations regularly for energy savings, works with Global Forest Watch to maintain sustainable resources and flat-packs goods for efficient distribution. IKEA incorporates environmentally friendly efforts into day-to-day business and continuously supports initiatives including UNICEF, Save the Children and American Forests.

While that all sounds lofty, IKEA is not always so serious when it comes to evangelizing all things environmental: It often displays its humorous side in ad campaigns. In April 2011, to celebrate the annual Week for Sustainable Development in France (encouraging people to adopt a more responsible environmental attitude), IKEA launched “The Mysterious Passenger” promotion through television spots. Participants registered on the IKEA France carpool site with the hope that they will attract the “mysterious passenger” to their IKEA carpool. Drivers (and passengers) were eligible to win €1,000 gift certificates.

Sustainability as business model
IKEA operates 37 U.S. stores supported by five distribution centers, where recycling containers have been de rigueur since the first stateside store opened in 1985. More recently, many of its stores are being built to LEED (Leadership in Energy and Environmental Design) standards.

Ongoing sustainability efforts in the United States include recycling paper, wood and plastic waste materials, incorporating energy-efficient HVAC and lighting systems into facilities, using recycled construction materials, installing skylights in warehouse areas and designing water-conserving restrooms.

In January, all U.S. IKEA stores stopped stocking and selling incandescent lights – well ahead of impending Energy Independence and Security Act of 2007 measures designed to phase out all incandescent light sources by 2014 – becoming the first major retailer to do so.

Such efforts have paid off publicly; in 2009, TIME magazine named IKEA one of the eight most global eco-conscious companies.

“Conserving natural resources and minimizing impact on the environment is part of our business model,” says IKEA U.S. president Mike Ward, “as reflected through our smart product design and manufacturing, efficient distribution as well as education and waste reduction at stores.”

Recent capital-intensive projects include a store under construction in Centennial, Colo. Due to open this month in a Denver suburb, IKEA Centennial will be its first U.S store to incorporate a geothermal system for heating and cooling.

Elsewhere, solar water heating systems are up and running in Charlotte, N.C., Draper, Utah, Orlando and Tampa. Solar energy systems are operational in Brooklyn, Pittsburgh and Tempe, Ariz., with systems currently being installed at a handful of additional locations. “Investing in renewable energy such as solar panels atop our buildings,” Ward says, “simply furthers this commitment to helping reduce our carbon footprint and improving the lives of many people.”

Beyond retail operations
Earlier this year, IKEA threw the switch on two new solar energy systems built with REC Solar of California. First to go online was IKEA’s southwestern U.S. distribution center in Tejon, Calif. The 1.8 million-sq.-ft. DC, opened in 2000, is now crowned with a 370,000-sq.-ft. solar array consisting of a 1.8 MW system designed and installed by REC and built with 7,980 REC Group panels.

The Tejon array system is estimated to produce 2.88 million kWh of electric power annually, the equivalent of reducing 1,986 tons of carbon dioxide, eliminating the emissions of 389 cars or powering 241 homes yearly. The Tejon installation also contributes to the local utility’s renewable portfolio goals and reduces the electrical grid’s carbon intensity.

“Having solar panels on the roof of [the Tejon] distribution center demonstrates that the company’s sustainable commitment extends beyond our stores into all facets of the retail operations,” says Martin Grieder, distribution operations manager for IKEA U.S. Western North America. “This solar photovoltaic system will reduce significantly the carbon footprint and electricity costs of this facility and will continue the global and U.S. initiative of IKEA to incorporate sustainable practices wherever feasible.”

The Centennial store has the largest single-use commercial rooftop array in the state. The 60,000-sq.-ft. array consists of a 498-kW system, built with 2,212 panels. IKEA and REC Solar estimate that this unit’s solar program will produce approximately 740,000 kWh of electricity annually and have the impact of removing the equivalent of 564 tons of CO2 from the atmosphere.

“This effort by IKEA will contribute to the local utility’s renewable portfolio goals,” adds REC Solar’s Ben Collinwood, director of national accounts, “and will lower the carbon intensity of the electrical grid.”

Green Grand Slam

Janet Groeber — Sun, 01 May 2011 05:22:41 +0000

LED lights lower costs, improve ambiance at Denny’s

With long operating hours and lots of equipment for storing and cooking food, restaurants devour energy. Add lighting, estimated to account for 25 percent of the load, and you can understand why many operators are finding a place for low-voltage light-emitting diode (LED) sources at the table.

Denny’s recently tested LED lights from Durham, N.C., manufacturer Cree in various applications, and the results were such that Cree LEDs are now the preferred lighting standard for all new and remodeled units in the full-service family restaurant chain.

Pete LaBarre, a Denny’s franchisee in Colorado Springs, Colo., is seeing green — as in dollar savings — since converting to LEDs. LaBarre has installed more than 400 Cree LR6 downlights in the dining rooms of his five restaurants — a move that has saved him around $15,500 per year in energy costs alone.

Impressed with the energy and maintenance savings the LR6 lights provided in the dining area, LaBarre subsequently replaced 500 restaurant perimeter fluorescent lamps with 200 Cree LR6 fixtures.

“Our lights stay on all the time,” he says, “so we did a watt comparison of what we had in place before the LR6 downlights.

“We found that we used 6,000 kilowatt hours less per month in the store that had the Cree fixtures vs. the store that had the fluorescent lighting,” LaBarre says.

High color rendering
Franchisee Joey Terrell’s second Denny’s in Joliet, Ill., was built according to LEED Gold standard. His restaurant includes a combination of natural lighting and Cree LR6 LED downlights to reduce the lighting load.

According to Terrell, the lighting design reduced utility costs by 83 percent: His electricity bill is now around $1,000 a month, instead of the expected $2,100 a month based on the average costs for his Mokena, Ill., location. “Restaurants use 285 percent more utilities than the average commercial building,” he says. “The easiest way to reduce these costs and improve energy efficiency is to switch from traditional fluorescents to daylighting and LEDs.”

In addition to reduced energy and maintenance costs, the LR6 downlights provide “the quality of light customers want,” says Cree’s vice president of LED lighting sales Craig Lofton.

LaBarre concurs. “It really is lighter in our restaurants because of the LED lighting. Fluorescent lighting “was kind of turning the colors green,” and that’s a turnoff to diners.

“High color rendering is especially critical in the food service industry, where steaks need to be beautifully red, peppers should pop with color and the wood tones of the décor can create a warm, home-like atmosphere,” Lofton says.

LEDs offer benefits to workers, as well. At the Colorado Springs Denny’s, “One server told us there’s less glare now,” Lofton says. “She notices her eyes don’t hurt after a long shift.” Another server remarked that customers regularly inquire about the new lights. “They ask where they can get them for their homes,” he says.

Cutting Back on Carbon Emissions

Ed McKinley — Thu, 14 Apr 2011 20:43:47 +0000

Web-only article: Report indicates retailers and suppliers are realizing profits from a greener supply chain

Fifty percent of large businesses and 25 percent of their suppliers have reduced supply chain costs by managing carbon emissions, according to the Carbon Disclosure Project’s 2011 Supply Chain Report. But observers say most retailers have only begun to limit the amount of carbon their supply chains release into the atmosphere.

CO2 output began entering the retailing industry’s consciousness in 2007, says Adrian Gonzalez, director at Logistics Viewpoints, a blog that grew out of Boston-based market research and consulting company ARC Advisory Group. That year, former Walmart CEO Lee Scott addressed social responsibility and sustainability in a widely publicized speech that commanded the industry’s attention, recalls Gonzalez.

Fortune magazine noted in 2006 that Scott had declared his intention to “turn the world’s largest retailer into the greenest” and invited former vice president Al Gore to discuss his climate-change film “An Inconvenient Truth” at a high-level, all-day internal Walmart meeting.

At about the same time, Walmart suggested that the Carbon Disclosure Project, or CDP, begin documenting supply chain emissions, says Zoe Tcholak-Antitch, director, CDP North America. The CDP had been compiling, monitoring and sharing statistics on factory carbon release since 2000, but the Walmart request prompted the organization to expand its work to the supply chain and to establish a baseline for supply chain emissions in 2007, she says.

Investor and consumer interest
The CDP’s 2011 supply chain report, released early this year, includes data from 57 large CDP member companies and 1,000 suppliers, Tcholak-Antitch says. Some 80 percent of participating companies make their numbers available on the CDP website, she notes, and data from all of the companies are aggregated to establish trends.

In the latest CDP annual supply chain report, 86 percent of companies attest to working with suppliers to improve performance, up from 46 percent in 2009, the CDP says. “This jump is evidence of how sustainable procurement practices are addressing climate change and could have major impact on the supply chain, which for most companies, accounts for at least 50 percent of carbon emissions,” the organization says.

Of the CDP member companies in the supply chain report, only Walmart is devoted to retailing, Tcholak-Antitch says. Merchandise supply member companies include PepsiCo, ConAgra Foods, Dell, H.J. Heinz and Unilever, she says. Member companies ask their suppliers to complete questionnaires, resulting in the four-figure list of database contributors.

Companies supply their data for the report because of interest among investors, Tcholak-Antitch says. “If a company’s not answerable to its shareholders, then who on earth is it answerable to?” she asks.

Some companies participate to comply with governmental regulations, says Chris Callieri, a principal at A.T. Kearney, the management consulting company that writes the CDP supply chain report. European governments demand more stringent reporting than the United States requires, he says, admitting that momentum toward U.S. reporting has flagged with the election of a Republican majority in the House of Representatives.

Besides meeting regulatory obligations, companies take part to build credibility for their sustainability efforts, Callieri says. Sustainability can differentiate companies from competitors and raise companies’ status among ecologically minded consumers.

“Retailers are at the front line of the world’s biggest democracy,” says Tcholak-Antitch. “Individuals vote with their money every single day in the products they purchase.”

Participating in the CDP studies, which Tcholak-Antitch acknowledges as a major undertaking, also provides metrics that help companies think through their actions and build internal awareness of sustainability, Callieri notes.

That awareness helps companies optimize their supply chains, which lowers fuel and electricity costs, eliminates waste from packaging, conserves water and reduces the release of carbon, Callieri says. “It’s difficult to reduce greenhouse gas emissions without savings,” he notes.

Quick, low-cost changes
Sustainability also helps create a better workforce and fits into other larger trends, says Gonzalez of Logistics Viewpoints. Campus recruiters say prospective employees ask about sustainability, and those questions grow out of an awareness that begins with recycling in elementary school, he maintains, adding that “in society as a whole, people are becoming much more in tune with this.”

Still, that growing consciousness on the importance of sustainability has not ignited enthusiasm among all retailing supply chain executives, according to Jack Horst, a principal at Kurt Salmon.
“It would be a minority of senior supply chain executives,” Horst says, “that would have come to the table with the idea of implementing sustainability issues in and of themselves.”

He provides a hypothetical example of a beleaguered manager juggling 13 distribution centers dotted across the country. The facilities, most of them 20 to 30 years old, operate on 15-year-old technology that fails to meet today’s standards for energy efficiency in lighting, heating and air conditioning.

“Overnight, my company has told me we have a goal to be sustainable and responsible,” Horst says, assuming the voice of the fictional supply chain manager. “Hey, that’s really nice, but I’ve got these 13 facilities we’ve bought that I can’t get out of overnight.”

Executives who cannot immediately raise $100 million for improvements can take advantage of some low-cost, quick-fix changes that return a benefit almost immediately, such as changing out lighting fixtures that waste energy, says Horst.

He sees longer-term opportunities in reducing the amount of materials used to create products, eliminating unnecessary packaging, building and retrofitting buildings for efficiency, and choosing efficient modes of transportation -- such as ships instead of planes from Asia.

Will those initiatives work? Observers cite a reason why supply chain sustainability almost always brings cost savings. “The only green projects that get done are the ones that are good for business,” says Gonzalez.

Horst puts it this way: “Supply chain professionals are a pragmatic lot. It’s almost got to translate to the bottom line or it’s probably not going to hit these guys’ radar.”

Power Play

Fiona Soltes — Fri, 01 Apr 2011 05:22:41 +0000

Prenova helps retailers keep tabs on energy systems

Combine continually rising costs with multiple locations and disparate assets, and energy management is a headache that many retailers would just as soon hand off. But what about those who seek a holistic solution with the control that comes from handling the tasks in-house?

Prenova, an Atlanta-based provider of energy management services, hardware and software, has a solution. This spring, the company will begin offering Energy_Point, a web-based energy management solution. The application will easily integrate with existing energy management system (EMS) implementations, says Prenova president and CEO Michael J. Nark, and the best part is that it’s “brand agnostic.”

“Instead of having to understand and know how to operate with six or seven different systems with all of their idiosyncrasies, Energy_Point normalizes it all,” Nark says. “It creates a single environment.”

Prenova’s ability to oversee the entire portfolio has been especially attractive in the retail sector. When retailers have numerous locations, Nark says, “some stores operate much more efficiently than others. It can be extremely complex.”

One benefit of Energy_Point, he says, is the ability to keep a closer eye on the way individual HVAC, lighting and other systems are performing. That allows retailers to be more proactive in terms of maintenance, as well as “to make the right decisions at the right time” when it comes to replacing systems.

“The uniqueness of this approach is its ability to leverage existing technology and assets,” Nark says. “Not only does it provide visibility, but it also offers control…. And sitting on top of that is the opportunity to bring better decision-making tools for how supply and demand work together.

“It’s not just about reducing the energy consumption,” he says. “We’re talking about energy spend.”

Meeting marketplace needs
Based on the company’s success with the outsourced solution, offering software-as-a-service seemed a natural progression, Nark says.

“We didn’t start out in energy management,” he says. “We started out as a facilities management provider, focused on the retail marketplace. But as the company evolved, more and more clients began asking for services related to energy and energy management…. Initially, that was about supply, and procurement strategies for natural gas and electricity. But it evolved to include the demand side of the business, as well, the linkage between the procurement side and tying that back to how the consumer base is consuming it.”

Those who have signed on with Prenova in the past have regularly experienced a 20 to 30 percent reduction in energy spend by centralizing controls, Nark says. Those who engage the Energy_Point application, on the other hand, should see “at least a 10 to 12 percent reduction,” he says, though it’s too early for actual statistics.

“Candidly, this allows us to reach a segment of the marketplace we didn’t have a solution for,” he says. “Some prospects and clients have already made the decision to outsource everything…. Others have made the decision to create their own internal team and expertise. Our goal is to offer them both the chance to become more effective, efficient and productive, and to give them information that allows them to be proactive vs. reactive.”

Sunny Side Up

Fiona Soltes — Sat, 01 Jan 2011 05:22:41 +0000

Cylindrical solar panels make harnessing the sun easy and effective

Perhaps you’ve been there: intrigued by the possibility of solar power, but not by the prospect of heavy ballast to hold panels in place, additional holes in the roof for installation or having to reinforce structural steel.

If that’s the case, Solyndra has good news. The company constructs easy-to-install, high-tech solar panels made of racks of cylindrical tubes that lay flat on a roof and greatly improve the amount of electricity produced per rooftop.

The Fremont, Calif.-based company has performed more than 500 installations on various roof types. Roughly four of five installations have been in Europe, according to vice president of marketing Mike Grunow, but if the company has its way, it will transition to more of a “50-50 split” between the United States and Europe over the next few years.

Most states offer incentives that support solar, in addition to a federal investment tax credit that turned to a grant at the end of 2010 that covers up to 30 percent of the cost of a reflective roof installed in connection with the Solyndra panels. Factor in the potential reduction in air conditioning costs due to the reflective roof, Grunow says, as well as projected energy savings, and customers often have an “a-ha” moment.

Suddenly, the normally wasted space on top of the building looks like an asset. “It tends to create a very powerful argument to move forward,” Grunow says.

Positive momentum
Solyndra has made its share of news recently. The company won a $535 million loan guarantee from the federal government and this year was named one of the “50 Most Innovative Companies in the World” by MIT’s Technology Review magazine.

Not all of the headlines were positive, however: Solyndra closed its first plant, laid off 40 employees and decided not to renew contracts for some 150 temporary workers, and halved its projected 2013 production capacity from 610 megawatts to 300 megawatts. Competition from low-cost Chinese manufacturers has proven tough.

And yet, Grunow remains optimistic.

“If you consider what’s happened over the last year and a half,” he says, “we’ve been able to cut our costs significantly.” The new facility can produce the panels more efficiently, he says, reducing costs even more.

Challenges aside, several things have happened to positively affect the solar landscape. First, Grunow says, technologies have become increasingly application-specific. There are now solar panels that work best on large commercial rooftop facilities. Five years ago, it was more “one-size-fits-all.”

“Customers want more than just solar electricity,” Grunow says. “They want their entire facility to be green.” Companies also are looking for ways to let customers know they’re using power from renewable resources and reducing their carbon footprint.

The perfect storm
And then there’s the fact that installation prices have significantly dropped.

“In 2007-2008, it wasn’t uncommon to see turnkey installation prices at $6 to $7 a watt,” Grunow says. “These days, we’re able to offer it from $4 to $4.50 a watt. Prices are down about 33 percent.”

For Chuck O’Brien, the decision to install Solyndra panels on two of his three California O’Brien’s Market grocery stores wasn’t a difficult one. Faced with a projected 10 percent rate increase by his utility company and the possibility of federal and state incentives that would allow installation “without a penny out of pocket,” O’Brien dove in last year.

He admits that, without the incentives, the solar installation wouldn’t pay for itself on energy savings alone. But it ended up being “a perfect storm” that fit into his company’s overall green efforts. The only reason he didn’t install the panels on all three stores, O’Brien says, is that the third has a barrel-shaped Quonset hut roof.

Roof shape and type is a factor for anyone considering solar. Many big-box roofs are what Grunow calls “value-engineered,” meaning they can’t support a significant load without structural upgrades. The Solyndra system, however, is not only lighter in weight but, since the wind blows through the cylinders, they don’t require the same anchoring as more traditional crystalline silicone flat panels.

According to the company, they also can be easily relocated or reconfigured when adding a skylight, updating air conditioning units or leaving the facility all together. And when paired with a cool (also called white) roof, the solar cylinders can reduce air conditioning expenses by 29 percent.

For those that don’t have cool roofs already in place — or don’t have roofs that will last far into the future — Solyndra is able to tie roof construction into available incentives.

Regardless, Grunow says, Solyndra has the ability to put solar panels “where other competitors just can’t go.

“Many times, we meet large retailers who are blown away because they have buildings in their portfolio that nobody has ever talked to them about putting solar on,” he says. “We think solar is going to grow really fast in the next few years, and we believe we’re the right people to help it happen.”

Working Off the Grid

Fiona Soltes — Wed, 01 Dec 2010 05:22:41 +0000

Are power-generation systems poised to change the energy landscape?

In recent years, “green” products, services and practices have become less costly. Returns on investment are starting to appear. But then there’s the field of clean energy. Still somewhat of a holy grail, the idea of clean, reliable, efficient energy that’s actually “affordable” remains an idea just out of grasp.

Or is it? Bloom Energy, based in Sunnyvale, Calif., has quietly been developing on-site power generation systems that use an innovative fuel cell technology. “Initially we were very quiet about our technology, since not much was known about us publicly,” says Asim Hussain, Bloom’s director of product marketing.

Operating under the radar to field-test “Bloom Boxes” before its public launch earlier this year, the company has entered the retail arena with clients like Staples, Walmart and Safeway. “This is a very progressive set of customers, focused both on the economic side as well as the sustainability side of the equation,” Hussain says, adding that the retailers are also “sophisticated in their understanding of energy.”

Here’s the lowdown for the rest of us: The Bloom Box, also known as the Bloom Energy Server, is a distributed power generator that converts fuel into electricity through a clean electro-chemical process. Somewhat similar to a battery, the generator doesn’t lose power. It also uses beach sand powder instead of metals like platinum or corrosive acids; offers higher electrical efficiency than traditional technologies; can work on either renewable or fossil fuels; and is considered “reversible” because it’s capable of energy generation and storage.

Each Bloom Energy Server provides 100 kilowatts of power — enough to handle a small office building — with a footprint the size of a parking space. In addition, the systems can be added like blocks, depending on the number of kilowatts needed.

Creating options
The boxes cost at least $700,000 each at this point, with customers “typically seeing a return on their investment within a three- to five-year period.” With the Bloom Boxes in place, clients are spending about eight to 10 cents per kilowatt hour in California, Hussain says, compared with 13 cents on the traditional power grid.

So far, according to the company, Bloom Energy has produced in excess of 30 million kilowatt hours for its customers, reducing their carbon footprint by more than 35 million pounds.

Hussain believes Bloom could change the energy landscape, which “as it’s been built out over the last century or so [has] been very centralized. Other industries have evolved from a more centralized infrastructure to a more distributed infrastructure. We see a similar transition in energy with a more distributed model, which allows our customers to utilize on-site generation to meet their energy needs. You always have the option of buying centralized power from your utility.”

What the company hopes to do is offer more of a balance — and ultimately, put more control into the hands of the customer when it comes to what’s produced.

“Our business case is very strong as you look at other technologies,” Hussain says. Solar and other sustainable options typically don’t offer a return on investment until “upwards of seven years, so from a technology standpoint, this is both innovative and extremely cost effective.”

Targeting Energy Efficiency

Fiona Soltes — Fri, 01 Oct 2010 04:00:00 +0000

Environmental Defense Fund internships help retailers develop energy savings plans

While making site visits to Target distribution centers in recent months, Jamie Mikkelsen was struck by the “vastness” of it all: Not just the size of the physical space, but also the great opportunities for energy efficiencies — and by extension, cost savings.

It’s not that Target was doing anything wrong; it was more that the company was doing so much right with sustainability initiatives that Mikkelsen wanted to come on board. The Environmental Defense Fund’s Climate Corps program allowed her to do just that.

A student at the University of Michigan working on both an MBA and a Masters degree in science, Mikkelsen spent her summer as one of more than 50 Climate Corps Fellows. Her purpose? To be another “champion” of energy efficiency at Target, bringing external eyes and ears to analyze energy saving opportunities and develop custom energy efficiency investment plans.

“It was a great experience,” Mikkelsen says. “I wanted to see how a large corporation tackles environmental sustainability issues.... And retail is a great space for sustainability. There are so many products out there that can be dealt with and improved upon, and ways that can be interfaced with the customer. There’s also a real opportunity for education and really learning what consumer needs are.”

The program, which began in the summer of 2008 with seven Fellows, has recently added retailers including adidas, J.C. Penney and Staples. This was the first year of Target’s involvement, and spokeswoman Erin Madsen says the company would “definitely consider” participating again.

“The health and sustainability of the communities in which Target does business has been incredibly important to us since we opened our first store in 1962,” Madsen says, “and this fellowship was a natural extension of that commitment. The partnership came about through relationships we had already established with the EDF. They approached us, and we felt like it would be a really good fit.”

Emily Reyna, a 2008 Fellow who is now a project manager with the program, says EDF looks for numerous criteria in fellowship candidates: “Big company” or consulting experience; enough financial training to be able to make the business case for the energy efficiency process; a “proactive, entrepreneurial or self-starter attitude”; and a passion for or past experience in sustainability.

“Companies — and people in general — pay attention when you can make a financial business case for sustainability,” Reyna says. “If I was going to go into a company that didn’t do anything in terms of sustainability, I would say energy efficiency was the place to start. It means easy wins and can show real savings over time.”

Integrating efficiency
In Target’s case, Mikkelsen was part of an environmental sustainability group already established at the company and was able to grow relationships in other sectors, as well. Seeing the “very large warehouse spaces” for the first time helped her realize that, in the fight for sustainability and energy conservation, “buildings are a great place to start.”

Madsen says Target — whose other sustainability efforts include in-store recycling stations, garment hanger reuse, lighting efficiency programs, trailer-loading optimization and the like — was already considering what could be done to improve the energy efficiencies of its distribution spaces. But it lacked the manpower to undertake a detailed analysis.

“We identified that [the Climate Corps] program would be a great fit for that,” she says. “A student would be able to apply theory learned in school with the reality of hands-on work in a large organization, so it would be mutually beneficial.” As a result, she says, Mikkelsen was able to deliver numerous recommendations that the company is currently considering in greater depth.

Students who take part in the Climate Corps program are paid by the company involved rather than EDF, and the going rate is a minimum of $1,250 a week. In the first two years alone, Climate Corps Fellows uncovered inefficiencies in lighting, computer equipment and heating/cooling systems that could help companies save $89 million in net operating costs over the lifetime of the projects. That’s in addition to cutting the equivalent of 280 million kilowatt hours of energy per year and avoiding more than 157,000 metric tons of greenhouse gas emissions annually. It equates to the amount of power used in 24,000 homes and the removal of 19,000 SUVs from the road, according to the EDF.

“Going forward, we’re trying to figure out the next step, so companies are really institutionalizing energy efficiency and sustainability into their overall decision-making process,” Reyna says. “We’ve had a handful of Fellows work on more strategic projects to do that. What I’ve learned, as the program evolves, is that some companies started with the low-hanging fruit. But they may have been doing that for 10 years and are now working to make energy efficiency and sustainability an ingrained part of the company process.”

In the meantime, Madsen says, the folks at Target will be considering the next project a Fellow might tackle. The company is already highly active in campus recruiting, and the Climate Corps program is another way to “stay connected to that emerging talent that’s poised to take on the sustainability challenges we face and will face,” she says. “Environmental sustainability is integrated throughout our business, from the products on our shelves to the way we design our buildings. Target takes a comprehensive, holistic view and applies what makes sense to stay relevant to our guests and affect meaningful change.”

LP Meets LEED

David P. Schulz — Wed, 01 Sep 2010 18:29:34 +0000

Ways to go ‘green’ without giving thieves the green light

It may not be easy being green, but it sure is popular — particularly with encouragement from the federal government.

Both Sears and J.C. Penney have stores that are among the 14 finalists in the National Building Competition being conducted by EPA – in the mid-point standings released in July, the Glen Burnie, Md., Sears store was in second place, having reduced its energy use by 18 percent. The winner is scheduled to be announced October 26.

With all the focus on building energy efficient stores, reducing carbon footprints and incorporating sustainability into the retail process from supply chain through checkout, little attention has been paid to what loss prevention and asset protection professionals can do to fulfill their core mission and contribute to retailers' overall green goals.

It’s all about trade-offs. For example, Tiffany is putting a store in a California mall that is being redeveloped and in which all tenants must meet LEED (Leadership in Energy and Environmental Design) certification. The process involves a point system, but does not specify individual components that go into building and outfitting a store.

In Tiffany’s case, the design calls for a marble facing on the storefront. Using stone quarried from within 500 miles of the store would earn a more favorable point rating, but for style and image consideration, Tiffany prefers to import the stone from Italy and offset that with more efficient air conditioning or lower lighting levels.

In a scenario that would be familiar to most retailers, this is where the horse trading begins between designers and operations people, including LP.

“We need to maintain certain levels of lighting and we believe it is a significant deterrent for bad activity,” says Mick Pinneke, senior director of asset prevention for The Home Depot. “When decisions are made, asset protection is definitely one of the [departments] with a seat at the table.”

It isn’t just national programs like EPA’s Energy Star or LEED, which is administered by the U.S. Green Building Council, a private, non-profit membership-based organization headquartered in Washington, D.C. Local governments have also moved to regulate environmental impact through building codes, says Alan Tague, vice president of loss prevention for Gander Mountain. “The rules [involving lighting] in some communities have moved from crime prevention to [being] less intrusive and/or energy saving.”

Lighting is particularly important to Gander Mountain because, as a retailer of outdoor sporting goods and equipment, guns are a part of the standard inventory. “When an alarm is tripped, such as might happen during a break-in, all the lights in the store go on — bright lights, not just security lights,” Tague says.

Office Depot has different challenges. The alarms utilized in its retail stores “are all low-voltage electricity and therefore fall in line with our energy efficiency goals of reducing power usage and lowering costs,” says director of loss prevention and global business continuity Bill Gavin. Additionally, he says, “Our security initiatives do not require an increase in the current lighting levels either, within our stores or the exterior of the stores.”

Skylights as a security risk
Last year, the Army & Air Force Exchange Service designed 30 construction projects to meet LEED standards. The projects include everything from shopping malls like the new one at Randolph (Texas) Air Force Base to base and post exchanges, mini-malls, restaurants and shopettes – convenience stores, in civilian parlance.

Doug Olney, program manager for real estate, and project manager for real estate Ron Ramsey worked on most of the AAFES projects. Olney says “the LP folks” complained that the shiny concrete floors in the new malls were interfering with their [video surveillance] monitors.” The glare “washed out what the cameras were showing,” he says. AAFES is studying possible solutions, including different buffing techniques, repositioning the cameras or adding filters or different lenses to the cameras.

Under the LEED scoring system, “you get a lot of points for natural lighting,” says Olney, which has resulted in “a lot of skylights on new stores and shopping centers.”

This raises security concerns, since the skylights could be smashed and provide entry to the premises. AAFES’ solution was to install “burglar bars” under the skylight. This had a minimal effect on the level of light coming through the skylight, but created an aesthetic challenge. AAFES is now looking into coloring the bars so as to help them “disappear into the background,” Ramsey says.
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Natural lighting doesn’t pose as much of a problem for Office Depot.

“We have found that there are many ways to secure the skylight in our stores, including motion sensors and unbreakable glass,” Gavin says. “With our plans to integrate skylights into all retail stores that we can going forward—because of the energy and cost efficiencies realized—it was critical to find a secure option.”

Even with all their experience in building facilities on military installations, there is still a learning curve — especially after the AAFES board of directors decreed that every building project must meet LEED silver certification standards.

Big-ticket packaging worries
Green efforts often include reduction or elimination of virgin packaging and shipping materials and the recycling of those materials. From an LP perspective, however, elaborate packaging on small, big-ticket items like GPS systems and digital cameras, make it difficult to slip them into pockets and handbags.

As an alternative, Office Depot “has moved toward using reusable plastic keepers, or Alpha Boxes, to protect sensitive products instead of plastic clam packs, which require much more material,” Gavin says.

It also uses low-voltage reusable alarm sensors and some battery operated sensors with rechargeable batteries to protect its display units.

Eric White, director of retail strategy for Wren Solutions and a former asset protection officer with Walmart, says, “Changes in packaging size and type will have little effect on the organized retail crime that several retailers are fighting.”

For the impulsive shoplifter, several factors contribute to the decision to steal, so retailers need to erect deterrents. These speed bumps include the way merchandise is packaged and displayed. “LP needs to carefully consider packaging changes to high-theft or high-loss items,” White says. “When they identify concerns such as reduced package size or packages that are more easily compromised, they need to work closely with merchants to either find an acceptable packaging alternative or to find a way to control the display in the store to offset the increased risk.”

The new focus on stripped down, streamlined packaging and shipping containers could also pose some other challenges, White suggests. With reduced bulk and lighter packaging, "improper stacking and loading of trailers will cause unacceptable damage regardless of individual product packaging,” he says. “The good news is that an effort to reduce overall packaging offers an opportunity to re-evaluate the loading and unloading process, and packages that fit together better in a trailer will reduce exposure to damage as well as reduce the number of trucks on the road.”

Stylish Sustainability

Fiona Soltes — Wed, 01 Sep 2010 18:29:34 +0000

Regis salons save money and energy with POS printers

When it comes to salons, image is not to be taken lightly — even when it comes to something as basic as receipt printers. Beyond simple style, speed and silence, Regis’ recently signed 8,000-unit deal with Epson America was based on another important perception: the manufacturer’s commitment to sustainable products and cost-saving efficiencies.

Not only does the installation of the TM-T88V single-station thermal printers promise “substantial dollars saved on energy costs over the life of the product,” says Regis IT director for store operations Oliver Lederer, it also helps the company “do our little piece in becoming more green.”
The TM-T88V was recently ranked highest in energy efficiency in its class. It holds an ENERGY STAR rating, uses a minimum of 68 percent fewer kilowatt hours than its competitors and boasts a reduced paper usage of at least 25 percent.

Barry Wise, Epson’s senior marketing consultant, says the company has been on the forefront of sustainability issues for two decades. More recently, Epson announced an initiative whereby every product must be built to certain sustainability standards, from the initial design through its entire lifecycle, and the company has become more vocal about its green efforts overall.

Seeking energy efficiency
Minneapolis-based Regis, whose corporate and franchised locations operate under the Supercuts, MasterCuts and Regis Salons banners, was in the process of a POS overhaul thanks to a fairly recent initiative to begin installing broadband in the salons. Additional changes at Regis meant IP-based credit card transactions rather than dial-up, as well as greater use of demographic and customer information. It also meant finding a printer that would eliminate the need for that duplicate “yellow copy,” would be sturdy without plastic parts that could break off and get lost, and wasn’t tricky when it came to replacing paper.

Regis looked to Storeworks, a master integrator and store-level technology consultancy based outside of Minneapolis, for recommendations. Storeworks conducted energy efficiency testing on 23 all-in-one POS terminals to make certain Regis had the leanest, greenest system. The Elo TouchSystems 17D Series All-In-One Touchcomputer and the Epson TM-T88V were the clear energy savers. The TM-T88V was also competitively priced and boasts industry-leading performance, reliability and ease of installation.

The printers have been ordered, and installation will take place in the company’s 7,500 corporate U.S. salons over the next few years. Field tests also are underway at Regis’ 400 corporate locations in the U.K.

“When we launched this project … we were looking for not just the right equipment functionally and practically for our salons, but also … [to] make this more of a green effort,” Lederer says. “Anything we do, we have to multiply out by nearly 8,000, so you can imagine the energy savings that you obtain even if it’s just a few pennies or few dollars per salon.”

The TM-T88V has seen numerous improvements in recent years that have made it less expensive to operate, Wise says. The printers have less circuitry inside, using less power; lower-temperature heads and better-quality paper also play into the mix. Then there are the algorithms that allow for more information to be put into a smaller space, “so what may have been a four-inch receipt before could easily be two-and-a-half now,” he says. “And when you factor in all of those things, we’re able to reduce our power consumption over our previous products and also over our competitors’ current products.”

Lederer also is excited by how easy the devices will be to install by salon personnel. Storeworks customized a self-install kit, which includes all POS components and takes advantage of both Elo POS and Epson design form and functionality.

“We needed something you could just turn over, see where the port is and push the cable in, and hear it go click,” he says. “A lot of manufacturers hide the cable management, because once a technician has installed it, they don’t expect a customer or anyone else to see it. But in our case, because we’re a self-installer, we needed the best of both worlds — it needed to be recessed, but it also needed to be easy to do.”

A different kind of energy savings, no doubt; but the way Lederer sees it, an important one, all the same.

Promoting Professionalism

Fiona Soltes — Wed, 01 Sep 2010 18:29:34 +0000

Stylish Sustainability SIdebar

Imagine watching a computer technician attempt to remove leftover adhesive from the piece of tape used to identify your laptop while it was in for repair.

This “haphazard methodology” for identification wasn’t doing British Columbia-based Simply Computing any favors in terms of customer service. It had also tried various bins and slipcovers to no avail. But then a company vice president saw a unique solution at a trade show that could easily be adapted across the Apple specialty store’s six service depots: Epson’s TM-T88VI ReStick POS printer.

“It seems like such a small thing, but it’s a big deal in terms of efficiency,” says Kyle Bennett, Simply Computing’s director of technical services. Labels can now easily be made with the customer’s name, work order and contact information, which prevents technicians from having to go back through the POS system. The ReStick POS printer features unique silicone rollers that don’t hold residue (which traditionally can cause label printers to jam over time) as well as a redesigned paper path. When paired with modified, liner-free paper, it can produce 60 percent more labels than die-cut that can be removed without leaving an adhesive residue.

Barry Wise, Epson’s senior marketing consultant, says the labels were originally introduced to the quick-serve restaurant industry. Epson also has been making inroads in book stores and libraries for hold and reserve materials. Thanks to “relentless” engineers, Wise says, the product went through nine months of rigorous testing “to make sure it could achieve” a high reliability rate.

A recent quarterly report shows that, since the roll out, professionalism has risen from 87 to 94 percent in Simply Computing’s satisfaction ratings; similarly, documentation rose from 85 to 94 percent.

“So we saw measurable gains in two areas that would likely be affected the most by bringing” the printers in, Bennett says, and “it’s way cooler than writing out five digits on a piece of masking tape. ... It sounds inherently nerdy, but it’s kind of neat.”

Staying True to Form

Fiona Soltes — Sun, 01 Aug 2010 18:28:39 +0000

Fresh & Easy builds sustainability into its basic business model

It never fails: Every time Fresh & Easy Neighborhood Market opens a new location, the media takes note of the free parking for hybrid automobiles.

It doesn’t hurt that the spaces are front and center. But the El Segundo, Calif.-based grocer, a subsidiary of British retailer Tesco PLC with more than 150 stores in California, Arizona and Nevada, does a lot more to encourage environmental responsibility — and not all of it is marked with a sign.

Sustainability efforts are deeply ingrained in the company culture. On a basic level, says the company’s director of communications, Brendan Wonnacott, “We try to be a good neighbor. And a big part of that is being responsible with the environment.”

Parent company Tesco, one of the world’s largest retailers, has set a high bar in terms of sustainability. Those efforts range from labeling products to show the amount of carbon released in their production, transportation and consumption to offering customers green “Clubcard” points for things like choosing bagless deliveries. Wonnacott is quick to say that Fresh & Easy is “an American business, designed from scratch with the American consumer in mind,” but the fact that its stores were recently rated 30 percent more energy efficient than other grocers fits in with the larger Tesco philosophy.

“We’ve brought ideas over from our other businesses throughout the world,” Wonnacott says. “And we’re still a very young and growing company. We’re always looking for new ideas and innovations.”

A different feel
A “green building” link on the Fresh & Easy website connects to a live solar panel feed on the company’s Riverside, Calif., distribution center. The center’s 500,000 sq. ft. of solar panels — considered one of the largest roof-mounted solar installations in North America — provide nearly one-third of the property’s energy. Not only does the live feed offer daily and monthly metrics, it also provides a tally of the total solar energy generated and how that translates to the equivalent number of cars taken off the road, acres of trees planted and tons of emissions removed from the air.

“It’s quite neat,” Wonnacott says. “Our commitment is not just about reducing our carbon footprint. In the end, it’s also about saving money, and being able to pass those savings on to our customers.”

As for the individual stores (being added at a rate of roughly one per week for the next year), features like concrete flooring offer less expensive installation, maintenance and repair, and skylights and large windows reduce lighting costs as well as “give the stores a different feel,” Wonnacott says. “We also use LED lighting, and that’s something customers are very aware of. It’s brighter, it looks better. We hear back a lot about the lighting in our stores — people are very happy.”

There is, however, a balance; too much natural light, without the proper windows, could bring in too much heat. The company’s first LEED Gold Certified store, which opened in September in Cathedral City, Calif., includes prismatic insulated skylights to reduce the impact on temperature. The rest of the lights in the store automatically dim in response to sunshine.

The effort is conveyed to customers through signs beneath the skylights that say, “Look up.” Night shades on refrigeration cases ensure the cool air won’t escape and can be reused by the secondary-loop systems. There’s also increased insulation overall to reduce the amount of needed heating and air conditioning; the use of only eco-friendly cleaning products; and the employment of farm-to-shelf crates to reduce shipping materials.

Tracking sustainability
Further in the background is the way Fresh & Easy deals with maintenance, utility bills and the monitoring of various sustainability efforts. Even before the first store opened in late 2007, Fresh & Easy partnered with Verisae, provider of the Sustainability Resource Planning (SRP) enterprise solution. SRP allows companies to measure, manage and monetize energy costs and carbon emissions. Verisae already had a longstanding relationship with Tesco, but in many of the locations Tesco serves, sustainability efforts are legislated. That’s not the case in the United States, so Verisae was excited by the opportunity to work with a proverbial “clean slate.”

“For a good percentage of time, people didn’t necessarily look at sustainability as a cost savings or business strategy,” says Art Quinn, Verisae’s director of U.S. professional services. It’s only recently, he says, that stateside businesses have begun to ask, “OK, operationally we’re doing pretty well. What is the next piece we can do?”

Verisae performs pre- and post-examinations of various sites, looking for energy saving opportunities and methodologies, “and then offers software to come in and track it all, so [retailers] can capture and understand the changes that are making an impact on their operations,” Quinn says. With Fresh & Easy, great strides have been made in maintenance timeframes, and having repair vendors clock actual labor hours rather than rounding up charges has offered another “really large win.” There are other little changes tracked by Verisae’s software modules, including night light usage in open refrigeration cases.

“They’ve really taken a great approach to energy efficiency,” Quinn says. “While they try to make things repeatable from a business practicality respect, they’re also trying to improve that model each and every time so that not only are they able to do it better and faster, but also more economically sound and sustainable.”

Wonnacott says he’s been consistently surprised with the reception the eco-friendly stores have received from local officials, environmental groups, curious competitors and the public at large. Even the response to Fresh & Easy’s 99-cent unbleached cotton shopping bags has been “unbelievable.

“It’s great to see such an effort that’s really built into every part of the business,” he says. “And it goes all the way through the stores to our home office and our distribution center…. It’s automatic. It’s built into our DNA.”

Making the Leap into reCommerce

Barbara Thau — Thu, 01 Jul 2010 14:22:33 +0000

Retailers partnering with Gazelle on electronics trade-in, recycling programs

Trade-ins of used electronics could become a viable revenue stream for major retailers, and a firm that bills itself as the nation’s largest reCommerce company is working to make that happen.

Under the program established by trade-in and recycling firm Gazelle, merchants reward shoppers with gift cards when they turn in their used home electronics. What’s in it for retailers? ReCommerce has the potential to boost store traffic, accelerate sales, foster shopper loyalty and enhance merchants’ eco-friendly image, says CEO Israel Ganot.

Before founding the company in 2006, Ganot headed up international expansion for eBay and held finance and operations roles with companies like PayPal. The inspiration for Gazelle began with his quest to unload a couple of outdated smartphones.

“I wanted to recycle my BlackBerrys, and a retailer wanted me to pay $10 for the privilege,” Ganot says. That’s when he realized that even eco-conscious consumers “are not going to pay for being responsible.” So Gazelle set out to do the reverse.

The idea was to offer people a way to ditch that stash of retired electronic devices cluttering drawers and gathering dust in basements in an eco-friendly manner — and reward them with cash.

When consumers trade in their items on Gazelle.com, they walk away with an average of $100, Ganot says. Gazelle also removes all personal information from the devices.

The trade-in concept certainly isn’t new: “You trade in an old car and get a new car,” he says, but “it doesn’t exist in other industries.”

While the company currently boasts a catalog of more than 200,000 SKUs it accepts for trade-ins directly from consumers — from cell phones to gaming consoles and digital cameras — it expects “the retail portion of our business to grow the fastest,” Ganot says. Gazelle has already established programs with Walmart.com, Costco and Sears, and more retail partnerships are in the works, he says.

ReCommerce as sales tool
Ganot says a typical U.S. adult spends $1,200 on electronics annually and has an average of 25 gadgets in the house — many of them unused. And in this post-recession era where many shoppers are maintaining a tight hold on the purse strings, retailers looking for fresh ways to jump-start sales could find a winning strategy in reCommerce, he says.

“At the end of the day, consumers want to be smarter about how they spend money and about the way they recycle products,” Ganot says. “This is a program that’s good for the wallet and [lets consumers] feel good about the environment.”

And while retailers do not profit directly from the program, they end up reaping “tremendous benefits” in the form of incremental sales and improved customer loyalty, Ganot says. “If you get a $100 gift card, you’re most likely to spend $200 to $300,” he says, and offering what is in essence a free recycling service allows retailers to showcase “the green side of the business.”

Costco is offering Costco Cash cards for shoppers’ unwanted electronics; Walmart.com’s electronics trade-in program rewards shoppers with a prepaid Wal-Mart Visa card.

Since launching its electronics trade-in program with Gazelle in November, Sears has seen 60,000 additional visits to its website, says Karen Austin, president of home electronics for Sears Holdings. The program enables Sears’ shoppers to trade in cell phones (which account for a hefty 61 percent of the returns), laptops, MP3 players and digital cameras. And Gazelle makes it easy for shoppers, sending them the box and picking up the cost of shipping.

While Austin would not quantify the sales lift Sears is deriving from its partnership with Gazelle, “We are pleased with the amount of traffic that the program has driven,” she says. Austin also affirmed Ganot’s claims of boosting incremental sales. “When a customer has a Sears gift card, they always spend more than the actual value of the card,” she says.
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In-store programs
Through its partnership with Gazelle, approximately 90 percent of the electronics traded in to Sears are slated for reuse; the rest will be recycled, which prevents products from winding up in landfills.

Beyond growing reCommerce via new product categories, “The biggest opportunity for retailers is to give them another merchandising tool to help consumers upgrade to the latest technology for less,” Ganot says.

Gazelle partnered with Costco on a holiday promotion that urged shoppers to trade in their old laptops and use their Costco Cash toward a new Windows 7-powered model. Apple’s iPad tablet computer might be another “great opportunity for retailers” to entice consumers to trade-up, he says.

Gazelle currently accepts products in 20 categories and has plans to add flat-panel televisions, home theater equipment and electronic book readers this year. Although its reCommerce programs are only being marketed online, Gazelle is gearing up to bring its retail trade-in programs to bricks-and-mortar spaces as well.

“We have been doing a lot of behind-the-scenes work to develop the in-store program,” Ganot says. “Over the next few months, we’ll move into that space aggressively.”

The next phase of growth will come from targeted retail merchandising programs at the store level, be it seasonal or new product promotions, he says. Back-to-school is a period when parents and students need to buy new laptops and consumer electronics, and reCommerce “is a great way to help consumers do it smarter,” he says. “Depending on what they buy, they can buy all new equipment for less.”

Still, less than 1 percent of all consumer electronics are resold, with the greatest barrier to growth being lack of awareness, Ganot says. “How do we get tens of millions of customer to learn about this service? That’s the biggest challenge.”

Expanding within the retail sector will help establish and build a reCommerce following, Ganot believes. To that end, Gazelle expects to add two or three “big, exciting” retail partners this year.
“We feel very strongly that over the next five years, reCommerce will become one of the biggest trends in retail,” Ganot says.