How to reduce the environmental impact of a business: the Up2You Insight guide

Making a business sustainable: the 4 benefits

With the advance of climate change, businesses have an increasing incentive to identify and decrease their negative impact on the environment. The retail sector is among those most affected, as it must respond to national and international environmental policies , but also to a market that is increasingly aware of the sustainability of products, and to increasingly discerning consumers and consumers.

A transition to greater sustainability by companies in retailing is desirable for the well-being of the planet for two main reasons:
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• 25% of global emissions are generated by commercial activities;
  
  
• these companies can generate change on the value chain and in consumer and consumer choices.
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And these are not the only reasons: for abusiness, committing to reducing the environmental impact from its activities also means securing numerous opportunities.

Here are the 4 main benefits:
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• Reduce costs by generating renewable energy on-site or reducing inefficiencies in energy consumption;
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• Attracting investment, ensuring long-term sustainability strategies;
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• Increase resilience by circumventing rising fuel and energy prices;
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• have competitive advantages, increasing buyers' confidence and meeting consumers' and consumers' interests.
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To achieve these results, it is not enough to reduce negative impacts on the environment: it must be done correctly. For this reason, Up2You Insight has produced a study to guide businesses that want to seize the opportunity to create long-term value by helping the planet.

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Emissions in the retail sector: what are the critical emission sources

The retail sector is one of the ten most emission-intensive business types. Moreover, according to the National Retail Federation, more than 90 percent of emissions from retail activities come from what is called Scope 3 in technical terms: in other words, all emissions generated upstream and downstream from business activities. These include, for example, emissions associated with the production of goods sold, their transportation, waste management, etc.

For this reason, business activities represent a sector with great influence on supply chains.

At the same time, however, the construction of an effective reduction plan is particularly complicated because it involves several stakeholders. To succeed in this endeavor, it is essential to first know the most emissive activities in the sector.
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• Product manufacturing: includes the operations of processing and converting raw materials into the finished product. The weight of this stage varies according to the category of objects considered, but, except in the case of electronics, it is not the most significant in terms of emissions. ‍‍

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• ‍Sales operations: include all processes associated with the sale of the finished product and can take place through a variety of channels, including e-commerce and physical stores. This phase includes the transportation of the product between retail facilities (warehouses, distribution centers, and stores), but not transportation to the consumer's home. Although the emissions from this phase are generally small, there is a big difference depending on the supply chains. In the case of physical stores, for example, energy consumption can be much higher than that of an e-commerce retailer.

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• ‍"last mile" transportation(from the store to the consumer): this varies greatly depending on a number of factors, including the sales channel used, the number of items purchased, and the choice of means of transportation. In general, whether the purchase takes place online or in-store, the main parameters affecting the impact of this stage are the total number of miles traveled and the chosen means of transportation.

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• ‍Product useand disposal: represents a major impact in the product life cycle. In the case of electronic products, household appliances and some types of food, it can be the most critical stage.
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• Production and extraction of raw materials: for many retailers this is a major driver of emissions. Activities in this phase occur prior to product generation and include agricultural activities and resource extraction. The transformation of materials into ingredients, packaging, fibers or other elements used in production is also part of this phase. In the case of food and beverage production, it can account for as much as 50 to 90 percent of total emissions.‍
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How to reduce a business's direct emissions: 6 tips

Knowing the most critical activities is not enough to identify an effective mitigation strategy-it is essential to quantify the emissions generated. This is done by collecting data on electricity, gas, fuel and refrigerant use in a year (Scope 1 and 2), and then calculating the associated emissions.

Once CO₂ emissions have been calculated, a number of strategies can be implemented to reduce them. Below are examples of Scope 1 and 2 reduction recommendations that apply to most companies.
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• Efficiency of building heating and cooling systems.
  The heating, ventilation, and cooling (HVAC) system generally accounts for 40 percent of an SME's utility bill. In retail businesses that sell fresh perishable products (e.g., food), cooling can play an even more central role and result in significant emissions caused by the use of refrigerant gases. In addition to replacing the system, if necessary, one can opt for systems with less impactful refrigerant gases, regular inspections, and maintenance work. Even simple choices, such as lowering the heating temperature by one degree and raising the cooling temperature, can have significant impacts in annual consumption.

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• Improve the lighting system.
  Lighting accounts for an average of 14 percent of a commercial building's energy consumption. This amount can be reduced by improving one's equipment, increasing maintenance, and increasing the use of natural light. Measures such as replacing old equipment with new LED models can reduce energy consumption by 50 percent, as well as bring commercial benefits.

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• Choose a renewable energy supplier.
  One of the easiest ways to reduce one's emissions related to energy purchases is to choose a supplier that sells energy generated from renewable sources.

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• Produce your own energy.
  This reduces the costs associated with purchasing, as well as the emissions associated with fossil fuel energy consumption. In particular, the installation of wind turbines and photovoltaic panels are recommended methods of renewable energy production. Generally, the long-term savings associated with this action exceed the initial investment, also bringing economic as well as emission savings.

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• Opt for electric or hybrid vehicles.
  Electric vehicles with zero or low direct emissions are increasingly numerous and affordable-a great alternative for your corporate fleet.

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• Limiting refrigerant gas leaks.
  By investing in detecting gas leaks and improving maintenance of refrigeration systems, unintentional releases of greenhouse gases can be reduced.

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How to reduce the environmental impact of your business: download the full white paper for free

Reducing direct emissions, however, is not enough, especially with regard to commercial activities: in fact, as we have seen, in the retail sector more than 90 percent of emissions come from Scope 3, i.e., emissions that are not directly dependent on business activities, such as those related to transportation.

For this reason, we have decided to provide you with 6 more tips to reduce the Scope 3 emissions of your commercial activity as well. You will also find plenty of data and information regarding retail businesses and sustainability, such as how many businesses are in line with theParis Goal or what can be achieved.

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Fill out the form below and download the full white paper for free!