The ROI for a Green & Sustainable Initiative

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Manufacturers often think the investment into green or sustainable technology and systems will far outweigh their financial benefit. This could not be farther from the truth and as more companies and corporations start making the switch, more evidence is piling up that proves going green is great for business. We’ve spoken a lot about how to go green and how it can help, but let’s dive deeper into how green and sustainable businesses are seeing the ROI many manufacturers are worried will not come their way.

Improve Profits With Cost Savings

The ultimate goal of any manufacturer is to create the most efficient and productive means to build your components and products in order to make the most profit possible. Green and renewable technology is one of the best ways to achieve this goal and bring down costs. Solar energy is a clean natural resource that can have a dramatic impact on the amount of money that is spent each year on energy. These systems have become much more advanced and affordable as well as needing little to no maintenance.

Manufacturers use a lot of energy, so it makes sense to cultivate your own so you can cut down on how much needs to be purchased from your energy provider. You will see a drastic reduction in your energy bill once making the investment into a solar system. Looking beyond solar power, keeping energy efficiency in mind when it comes to your facility can further reduce the cost to heat and cool your building.

For example, a major hotel project spent $184,000 on energy efficiency improvements and after a year they saw a savings of $58,035. This breaks down to a 3.17 breakeven point. After 3 years, your business will essentially be putting $58,000 directly back into their pocket. bit.ly/1GJlrds

Also, with solar power you can establish a constant energy bill. Energy costs fluctuate and costs can change by the day. With a solar system in place, a manufacturer will be able to see exactly how much energy is being harvested and how much extra energy they will need from the energy provider. This will help a company know what energy will cost them each year.

Marketing Potential

Customers have increasingly been more willing to give their business to green companies. There are a few reasons for this. One being the cost savings the manufacturer receives from their green initiative often trickles down to the customers. This does not mean green manufacturers are willing to lower their profit margin. Green manufacturers are able to charge less and keep the same profit margin because their energy costs are lower so it costs them less to manufacture any component or product the customer needs. Second, customers appreciate when a business thinks beyond the sale. A green manufacturer is able to use their green status as a marketing tool . They can show that they made the necessary investments to ensure their company is doing more than their competitor. Manufacturers with a green initiative stand out above the rest because of that fact.

30 percent of consumers plan to increase their spending at social responsible businesses (bit.ly/1QUx5t5).

Not only will you be increasing your customer base, your customers are more likely to stay loyal. Loyal customers are return buyers as well as a great way to spread the word about your business. Building a relationship with a customer that revolves around your services and your environmental responsibility will further help your marketing efforts.

Employee Loyalty

Along with creating loyal customers, employees are more likely to appreciate their company if the business is willing to do their part and take on some environmental responsibility. Employees that appreciate the company they are working for are willing to go above and beyond for that establishment. You can even have your employees be a part of the businesses green initiative. Offer incentives for more efficient and productive use of equipment and materials while taking employees suggestions on how to further increase the sustainability of the business. If an employee feels like they are making a bigger difference, they will be more inclined to stay with your company.

An employee that knows their company is doing harm to the environment can feel a sense of personal guilt. Their work will suffer and you can bet they won’t be talking highly about the company to others. But one who feels like they and their company are both offering great products while also protecting the environment will be much more inclined to portray your business in a positive light to potential customers and future employees.

These are just a handful of ways companies are seeing the return from their green and sustainable initiatives. Recently an article was published by CNN stating that show companies that made the switch to green are not only doing well, they are outperforming those who have put green on the back burner. It is no longer a question whether or not green and sustainable technologies are worth the investment, the question is why are some not willing to invest when the data is as clear as an emission free sky.

Sources & Additional Material

https://mfgtalkradio.com/what-it-takes-to-become-a-sustainable-manufacturer/

http://www.greenconsultants.com/why-green.php

http://tech.co/9-surprising-reasons-business-make-switch-solar-2015-12

http://www.usgbc.org/articles/business-case-green-building

http://money.cnn.com/2015/11/04/investing/climate-change-stocks-to-buy/index.html?sr=fbmoney113015climate-change-stocks-to-buy1230PMStoryLink&linkId=19125639