Go green or go home: 12 steps to sustainability in retail

May 7, 2024

Serge Khmelovskyi

CEO, Co-Founder at COAX


Eco-friendly shopping is no longer a whim of a small market segment. It’s a growing trend that’s only gaining more spread, forcing retailers and e-commerce providers to adopt sustainable practices. Sustainability is becoming a must in retail, as it’s one of the industries that cause the greatest damage to climate and the environment. 

But to truly win your green-oriented customers’ loyalty, using biodegradable materials in the packaging of your goods is not enough — you should implement consistent retail sustainability throughout your supply chain, technology used, and brand image. 

Feeling overwhelmed? Don’t worry! We will guide you through the labyrinth of sustainable trends, stats, adoption steps, and strategies, and throw in some examples to watch and learn from.

Sustainability is shifting demand in the retail industry, and here is how

Let us crunch some numbers and facts before starting your next strategic meeting with the question, “What are the sustainable resources we should use right now?.”

Sustainable trends are now a cornerstone of shoppers' choices. According to the EY Future Consumer Index, 44% of shoppers prefer a more sustainable alternative despite the price. 91% of consumers surveyed by ESW see sustainable retail as a priority. If you’re wondering about the benefits of sustainability in retail, apart from a bigger customer base, going green often allows you to cut costs and offers a higher price policy for ecological products.

85% of businesses prioritize ESG (environmental, social, governance), and for a good reason. 21% of Gen Z and Millenials simply stop buying products from brands that don’t show transparent and consistent sustainability in their business. Younger shoppers turn to ethical fashion, eco-friendly appliances, and home improvement providers who care for their carbon footprint.

What’s behind this demand? Let’s face the fact – the retail industry produces waste that is often hard to recycle and creates a damaging amount of emissions. The weight of globally produced plastic packaging reaches 86 million tons annually, and the overall emissions from transporting returned products is up to 6 million tonnes of CO2.

As this information is open and concerns the public, 65% of online retailers and e-commerce brand owners put sustainability improvements at the center of their marketing strategy, 75% of companies are already investing in it, and 53% are using climate-friendly technologies. 

Wondering how this can work for you? We will show you sustainability tips and examples of how to implement responsible practices.

sustainable trends

Steps to embrace sustainability in your business 

As we already said, retail sustainability is not only about the products you sell — it’s every step of your business strategy, partnerships, logistics, and even marketing. Did you know that 98% of emissions produced by a retailer come from the supply chain? 

Here are some answers on how to become more sustainable and gain the trust and loyalty of your modern, conscious consumers.

Step 1: Include sustainability in your brand strategy

If your retail environment relies on outdated practices, sourced from suppliers with high waste and emissions, and your technology leaves a significant carbon footprint, it's challenging to establish yourself as a leading sustainable fashion or home design brand. Customers can easily distinguish genuine sustainability efforts from green-washing, so transitioning to eco-friendly practices and products is essential for long-term success.

To make your retail sustainability consistent, start by defining clear, achievable, scalable goals and voicing them to your stakeholders. Find ways to showcase your sustainable practices to customers, but don’t call yourself 100% green and eco-friendly if your suppliers aren’t. Explain to your team why sustainability is important and ask for feedback from your shoppers. Slowly but steadily, your brand will gradually become a transparent and trustworthy option to choose.

As one of the greatest sustainability examples, IKEA made green the new black. For years, they’ve invested in renewable energy sources and sustainable transportation in their logistics, expanded their product selection to be more environmentally friendly, educated staff on sustainable ways of working, and constantly published detailed reports and roadmaps. By 2030, they aim to transition to suppliers that only produce renewable and recycled materials. 

Step 2: Become a paperless eco brand

One of the easiest places to start is by implementing digital receipts. Instead of paper-based receipts, provide your customers with electronic versions accessed via email, mobile apps, or your online portal. Apart from the sustainability benefits, this also automates and streamlines your reporting and accounting processes.

The best part? You can use your digital receipts to showcase your brand and drive engagement. How? Include links to your website, social media channels, and information about upcoming promotions or events to keep your customers informed and encourage them to stay in touch.

Another way to reduce sustainability issues in business is to use digital calendars and scheduling tools instead of paper-based timesheets and schedules. Think about transitioning to digital banking statements and invoicing instead of endless blanks and forms — you will free up some hands and lower the risks of mistakes as a bonus.

Example: Coop Sweden, a consumer grocery store chain, has launched a program to provide digital receipts to customers and also made them interactive to be more attractive for shoppers. They can access their receipts and see spending analytics through the payment app and the website. A colorful UI with infographics and analytics showing the most purchased goods is another way to increase an average order value while being in tune with sustainable trends.

sustainable practices examples

Step 3: Use sustainable energy resources

In addition to reducing physical consumption, retail businesses can save significantly by adopting more energy-efficient practices. One easy step is to switch to LED light bulbs. LEDs use far less power than traditional bulbs, providing immediate energy savings. For greater retail sustainability, you can also explore solar power options to offset electricity usage for lighting and electronics. 

Beyond lighting, adjusting thermostat settings can make a big difference. The U.S. Department of Energy estimates that lowering the thermostat to 7-10 degrees Fahrenheit for 8 hours a day can reduce energy consumption by 10%. Ensuring computers, printers, and other electronics are turned off when not in use is another simple way to cut back.

Example: Patagonia, which is trying hard to become an eco-friendly fashion brand, installed solar panels at many of its locations and encourages employees to power down devices and minimize unnecessary energy use.

sustainable brands

Step 4: Join the ranks of sustainable retailers with eco-packaging

According to Gitnux, 48% of shoppers are willing to pay more for packaging that is sustainable. Eco-friendly packaging is a crucial marker of a brand's commitment to sustainable practices. While achieving "zero packaging" may not be realistic, businesses can still make conscious decisions to reduce their environmental footprint. 

By embracing the 3 Rs — Reduce, Reuse, Recycle — retailers can explore more sustainable packaging solutions. Look for packaging solutions made from renewable resources, such as paper, cardboard, and biodegradable materials. Also, choose lighter-weight materials, eliminate unnecessary layers, search for ways to reduce package sizes, and clearly communicate the recyclability of your packaging — or offer refillable containers for some products.

how to improve sustainability

One of the brands that adopted environmental trends in business is Byron Bay Bath Bombs, whose sustainable packaging is at the core of its business model. They only use reusable, recyclable, and compostable materials, such as paper stickers and cardboard cylinders. These materials reduce waste and allow customers to repurpose the containers, further extending their lifespan. This approach differentiated the business as an eager retail sustainability brand.

Step 5: Follow the lead of sustainable fashion companies with digital showrooming and sampling

You will be surprised how digital showrooms and virtual samples not only reduce waste, lower costs, and enhance the buying experience but also streamline sales and gain a wider customer base. Here’s how to achieve it:

  • Integrate retail AI software, e.g. virtual showroom instead of traditional physical showroom setup. Without the need for in-person, physical shopping, your customers can browse and place orders from the comfort of their own homes and offices. Virtual try-ons can become your #1 positioning not only as an eco-friendly fashion brand but as a personal helper providing a unique experience.
  • It’s not only about ethical fashion try-ons – any other physical products can be sampled. If you showcase your collections through 2D or 3D virtual samples, you can greatly lower the environmental impact of producing and shipping physical samples and save on material and transportation costs.
  • Another result of such sustainability improvements is reducing carbon footprint by making virtual, digital shopping and transactions your main form of selling. With no need to travel to your store, your customers won’t produce as much vehicle emissions. Besides, digital transactions are faster and lead to a wider customer base.
sustainable fashion brands

Step 6: Become a part of the sustainability industry and sell eco-friendly products

To understand the core of retail sustainability, you should critically assess the products you are selling and shift towards those that position you as an eco-brand. This includes the durability of all materials and the social responsibility connected to their supplying and handling.

This can be a lot to grasp, but let’s explore the sustainable practices examples for each of these components more thoroughly.

Durability as one of the benefits of sustainability

Durability directly impacts product lifespan and environmental footprint. By creating long-lasting products, you reduce resource usage, waste generation, and promote responsible consumption habits. Here’s how to make your product more durable:

  • Prioritize quality materials and construction

The first criterion of retail product sustainability is quality. Only high-quality, durable materials can withstand regular use and wear over an extended period.

Example: Pottery Barn uses only solid wood and reliable construction techniques to ensure their products last for years. This supports the brand image and lowers customer claim rates of damaged and returned products.

  • Minimize the need for frequent replacements

Sustainable retail products aim to reduce the need for frequent replacements, which can contribute to waste and resource depletion. 

Example: Patagonia's outdoor apparel is designed to survive even the harshest conditions, reducing the need for frequent replacements and reducing the environmental impact of manufacturing new products.

Social responsibility at the heart of sustainable brands

Sustainable retailers prioritize the well-being and fair treatment of their employees throughout their operations and supply chain. Here are some social sustainability tips:

  • Ensure employee well-being and fair treatment

What does sustainability mean to you? Firstly, it’s safe – both for shoppers and your own employees. They should have access to a safe and healthy work environment, free from hazards or risks that could compromise their physical or mental well-being.

  • Provide safe working conditions and fair wages

Let’s make it clear: when working for sustainable retailers, employees receive fair and competitive wages that allow them to maintain a decent standard of living – paying wages that meet or exceed the local minimum wage requirements and industry standards. 

Example: IKEA has committed to paying all of its employees, including those in its supply chain, a living wage that covers basic needs and allows for discretionary spending.

Step 7: Go local as the sustainable way of working

Local shopping is about to go viral. 48% of consumers say they prefer to shop at local businesses even at higher price tags. This can be easily explained. Grocery store chains offering locally grown fruit and vegetables with a higher nutritional value don’t just increase their price tag to drive revenue but attract a new segment of consumers, caring for clean food. And this goes way beyond local farm production.

Consumers are getting more concerned about the accumulation of waste in the apparel industry, with only The US producing 20 million tons of textile waste each year. How can you become an ethical fashion brand, gaining trust and rising demand for your products among eco-conscious shoppers?

You should start with local materials for the clothing you sell and advertise. Some more eco-friendly fabrics you can get from local suppliers are cotton, hemp, tencel, and linen, and it’s not only about not investing in chemical-packed artificial produce. Studies show that organic cotton farming uses 62% less energy and 88% less water. This way, you can support sustainable practices throughout the supply chain, becoming water- and energy-efficient yourself, and promoting safer and less consuming suppliers.

Step 8: Get certified to prove your sustainable resources

Since we mentioned eco-friendly materials, let’s delve into how to make sure you are using them, and prove it to your customers. In sustainable business development, certifications are vital for eco brands to demonstrate their commitment to environmentally and socially responsible practices.

Here are some examples of certifications to confirm and demonstrate your sustainable practices:

  1. Fair Trade Certified is a must-have for eco-friendly clothing brands that show humane working conditions. Many of Athleta's apparel items, such as yoga pants and sports bras, carry the Fair Trade Certified label, ensuring the ethical treatment of workers and sustainable production practices.
  1. Bluesign® Сertification is a trademark of ethical fashion that confirms responsible materials and fair employee rights. Levi's has several denim products that are Bluesign® certified, ensuring responsible chemical usage and manufacturing processes. 
  1. OEKO-TEX® Standard 100 certification – the best sustainable clothing brands receive this certificate to prove that they care for their customers. Clothing brand Tentree has several products certified to the OEKO-TEX® Standard 100, ensuring their apparel items are free from harmful substances and chemicals, prioritizing consumer safety.
  1. Forest Stewardship Council (FSC) certification is the label of quality to show sustainability in furniture and wooden craft retail. Furniture retailer West Elm sources FSC-certified wood for many of its products, supporting responsible forest management and sustainable forestry practices.

Step 9: Know your product lifecycle to align with sustainable trends

Conducting a comprehensive product lifecycle assessment is crucial for sustainable retailers to evaluate and minimize the environmental impact. Here are some considerations:

  • Evaluate environmental impact from production to disposal. This involves analyzing the product's entire life cycle, from the extraction of raw materials to its eventual disposal or recycling.
  • Analyze raw material extraction, manufacturing, transportation, and product use. Examine the environmental impact of extracting raw materials, such as mining for metals, harvesting timber, or growing crops for natural fibers. Then, assess the environmental impact of the manufacturing processes, including energy consumption, water usage, waste generation, and emissions. 
  • Estimate the carbon footprint and environmental impact of transporting raw materials and finished products to retailers and consumers. To fully evaluate your retail environment, consider the environmental impact during the product's intended use by the consumer, such as energy consumption or the release of harmful substances, and identify ways of sustainability improvement. It will significantly simplify the pathways to implement sustainable practices in your supply chain and logistics. Read below how to do it.
sustainable retail

Step 10: Improve the sustainability of your logistics

Apart from sourcing more sustainable raw materials and implementing energy-efficient manufacturing processes, our sustainability tips involve optimizing transportation routes and switching to more environmentally friendly vehicles and delivery principles. Here are some ways to be more sustainable in your logistics:

  • Try to consolidate multiple orders into single shipments whenever possible to reduce fuel consumption and emissions.
  • With logistics partners that use advanced algorithms to plan the most efficient routes to make mileage less extensive
  • Depending on the distance and size of the cargo, different vehicle types — rail, truck, or ship — are combined.
  • Coordinate with carriers and suppliers to ensure that trucks aren't running empty on return trips. At least try to gradually transition your fleet to more fuel-efficient vehicles (electric, hybrid, or biofuel ones).
  • Explain and educate your drivers about sustainability benefits and eco-driving techniques, such as maintaining consistent speeds and smooth acceleration to improve fuel efficiency.
  • When possible, source raw materials and products from local suppliers to minimize transportation distances and emissions.
  • Consider investing in carbon offset projects, such as reforestation or renewable energy initiatives.

Step 11: From environmentally-friendly clothing and transportation to the circular economy

Sustainable retailers can explore opportunities for circular economy practices. Sounds too difficult? You can start by implementing take-back programs or offering product refurbishment services.

Example: Patagonia conducts lifecycle assessments on their products, analyzing everything from the sourcing of organic cotton and recycled materials to the energy consumption during manufacturing and the potential for recycling or repurposing at the end of the product's life. This allows them to identify areas for improvement and implement sustainable practices throughout their supply chain and product manufacturing.

Step 12: Show a firm position in protecting human rights

Eco-conscious brands don’t forget to recognize the importance of respecting human rights at every stage of their supply chain. This involves:

  • Prohibiting child labor: a shouting response to sad statistics. Nowadays, ethical fashion companies have strict policies against employing children below the legal working age and take measures to prevent and address any instances of child labor within their operations or supply chain. Example: Levi Strauss & Co. has a comprehensive program to monitor and remediate cases of child labor in their global supply chain.
  • Preventing forced labor. Retailers should ensure that all employees, including those working for their suppliers, are employed voluntarily and without coercion or threat of punishment. Example: Clothing brand Pact has implemented strict audits and training programs to prevent forced labor across their supply chain.
  • Publish official, transparent reports and press releases to confirm that you take human rights throughout your supply chain extremely seriously. Don't forget to share your dedication to ethical, sustainable business development on social media.

How technology and innovation drive sustainability initiatives in retail

In addition to choosing the right marketing messages and suppliers, the technology you use can make or break your transformation into a sustainable retailer. Retail automation solutions enhance transparency, optimize resource utilization, and streamline supply chain operations, empowering environmentally conscious business practices.

IoT technology for efficient sustainability improvements

IoT technology enables retailers to monitor and track various aspects of their operations in real time. Smart sensors and connected devices can track inventory levels, monitor energy consumption, and identify inefficiencies in supply chain processes, allowing for prompt corrective actions and resource optimization.

To give you an example of such technology, let’s see what RFID is. It’s an abbreviation for Radio Frequency Identification, an IoT application that is gaining traction in the retail industry for sustainable supply chain management and inventory tracking. RFID tags are small, wireless devices that can be attached to products, packaging, or pallets, allowing retailers to track and monitor their inventory in real time.

sustainable practices

Example: To become a more eco-friendly clothing brand, Zara has implemented an RFID system across its supply chain. This helps the brand maintain optimal inventory levels, reduce overstocking, and minimize waste.

Data analytics at the core of sustainable retail transformation

Retailers can help each other with valuable insights into consumer behavior, preferences, and purchasing patterns. Optimized product offerings and inventory management reduce waste by aligning supply with demand more effectively, and it’s only one of the sustainable data analytics practices examples.

Data analysis can improve various stages of the supply chain — from manufacturing and transportation to distribution. It helps define bottlenecks, and this information can be used to optimize routes and minimize carbon emissions.

In tune with the RFID technology, the data from IoT sensors can find opportunities for energy saving – HVAC systems, trying various kinds of energy-efficient lighting, and identifying suitable renewable energy sources.

Artificial Intelligence and Machine Learning supporting sustainability for businesses

AI and ML are revolutionizing various aspects of retail operations, including demand forecasting, inventory management, and waste reduction. These technologies can analyze vast amounts of data, identify patterns, and make predictions that inform decision-making processes. AI-powered maintenance, and route optimization solutions help retailers minimize waste, reduce energy consumption, and optimize logistics operations. 

Example: Albertsons Companies utilizes sustainable tech practices with an AI platform that optimizes fresh produce forecasting and inventory monitoring. The result? They reduce food waste while effectively meeting consumer demand.

sustainability in business

Workflow automation software to assist retail sustainability

The technology used to manage your operations, transactions, and sales is a part of your strategy for becoming a sustainable brand. 

  • POS systems allow retailers to offer paperless receipts, and store data regarding the sustainability of products and materials, ethical sourcing, and carbon footprint. 
  • Inventory management solutions help reduce the environmental impact associated with excess production and transportation, promoting transparency and sustainable practices. 
  • CRM systems connect transaction information to the marketing channels to push initiatives like upcycling and show the company’s dedication and commitment to sustainable ways of working. 

By integrating these technologies, retailers not only boost operational efficiency but also strengthen their dedication to environmental stewardship. 

How COAX helps businesses achieve sustainability in retail

Sustainability is transitioning from a trend to a necessity, and for good reason. It adds value to your services and products by resonating with a growing eco-conscious consumer base. Helping businesses implement sustainable practices through technology is our passion, and we’re eager to collaborate with retail companies to make it global. 

For example, we connected a network of IoT devices and a custom web app for a greenhouse business. The whole system is designed to automate data collection, analyze crop health and yield, reduce waste, and monitor the environment inside and outside the greenhouse 24/7. 

retail sustainability

The connected farming platform allowed our client to increase revenue by 14%, reduce resource waste by 25%, and lower operational costs by 12%. Also, in line with sustainability travel trends, the company launched an open greenhouse for agrotourism, opening a new income source and improving the region’s ecology. 

With a firm grasp of retail sustainability's global importance, we use our tech knacks to create solutions that make sustainable shopping easier and more accessible to everyone.

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