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Green Products Under Scrutiny

Many manufacturers claim their products are environmentally-friendly, but how green are they? Priya David reports.

Green is the catchword for natural resources conservation in today's marketplace. The short is short and sweet, almost genetic in its core understanding. We love green...the trees and grass and food sources.

But green products and services require a healthy dose of realism and conscience beyond those universal understandings. By one count, manufacturers launched 328 supposedly environmentally friendly products last year, up from just 5 in 2002.

"Environmental" claims such as rcycled content, non-toxic ingredients, lower emissions, etc. must pass Federal Trade Commission standards on packaging and in advertising.

Certifications such as USDA organic, EnergyStar, LEED, and Canadian EcoLogo auditing and verification programs help consumers sort "marketing slime" from verifiable, measurable, specific claims.

The FTC is cracking down on green marketing. They are accelerating review of  aging FTC "environmental claims" requirements ahead of their normal scheduled review. Watch for increased scrutiny...and labeling specifics. Get ready to have your products tested, reviewed, certified and audited if you want to tap into the green marketplace.

Reference: CBS Interactive. May 18, 2008

"Transition" in business models is nothing new to green companies.  Traditional methods don't work.  New technologies must be bought, paid for and learned on the fly. New marketing methods adopted that emphasize transparency, reporting, FTC regulations about environmental messages...plus all the struggles to find qualified people with some green and sustainable business knowledge...and maybe a bit of experience?

Transition is also being faced by print media, and maybe there are lessons we can learn from these highly public companies that are having to make significant changes in full light of their communities:

Print-Online Transition Is Possible
The New York Times

Among the big questions currently hovering over the media industry is can print media survive the transition to the Internet? The question has taken on new urgency, as the tanking economy places even more pressure on newspapers and magazines (whose customers and advertisers were already heading to the Internet in droves even before the recession).

The experience of International Data Group, a technology publisher, suggests that it can be done. The privately held company claims to have successfully migrated its publications to the Internet, where online ad revenue now surpasses that of print. However, the transition was not seamless: It took years of investment, upheaval and changes in its journalism practices.

"The excellent thing, and good news, for publishers is that there is life after print - in fact, a better life after print," said Patrick J. McGovern, the founder and chairman of I.D.G. InfoWorld, the company's flagship publication, completely moved its operations to the Web a year ago. In April 2007 it generated ad revenue of $1.5 million on a slight operating loss. Today, the Web site makes $1.6 million a month with an operating profit margin of 37%. Overall, 52% of the company's revenue is from online ads, while 48% comes from print.  SOURCE:  NYTimes.com

It can take months of waiting nervously to see if significant changes take root and survive infancy to flourish:

The biggest single step in I.D.G.’s online shift came in 2007, when the last print edition of InfoWorld appeared and it became a Web-only publication.  The technology publisher has not just stabilized its business, but is also  growing at about 10 percent a year.

One strategy that transitioned over time is adopting an “online first” business model. Three years ago, the editorial staff was divided into three people who worked on the Web site only and the rest only on print. Today, there are no print and Web barriers. The total staff size, at 23, is one fewer than in 2005, but now most of them spend 80 percent of their time on the Web, while a handful of writers spend 80 percent of their time on the long centerpiece articles in the print magazine.
That same strategy can work for traditional companies that are transitioning into the green space.  By building an inside team who work through the transition one step at a time, they build the infrastructure, the corporate intelligence, and prepare the new managers for the new world. 

Larger, traditional companies have the luxury of this kind of transition, notwithstanding a corresponding problem that arises out of a fast transition to climate change regulations that necessitate a speedy response.

Smaller companies that are "totally green" don't have that traditional revenue behind them...nor do they have the legacy staff, the legacy shareholder expectations, or the legacy management to convince every step along the way.

But what is clear in the board rooms around the world, is that the green transition is of as great, or greater seachange than the Internet.  The survival of entire cities and corporate land holdings are just one of the dangers that are driving this transition. 








Wal-Mart Sustainability Scorecard

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Wal-Mart sustainability scorecard standards

15% will be based on Greenhouse Gas (GHG)/CO2 per ton of Production
15% will be based on Material Value
15% will be based on Product/Package Ratio
15% will be based on Cube Utilization
10% will be based on Transportation
10% will be based on Recycled Content
10% will be based on Recovery Value
5% will be based on Renewable Energy
5% will be based on Innovation


Sustainability Planning Resources:

Design Guidelines Available Online

THE WAL-MART SUSTAINABILITY SCORECARD

It’s likely that you’ll soon have to comply with your customers’ sustainability initiatives as well as your own. That's the case if you provide products for the Wal-Mart chain of retail outlets.

Wal-Mart has taken a "lifecycle approach" to packaging with objectives covering reduction in waste and renewable energy. Nine weighted parameters of Wal-Mart's sustainability scorecard are measured for their prospective and current vendors.

Wal-Mart has told its buyers that, starting in 2008, they should consider the packaging scores when choosing among various products for its Wal-Mart and Sam's Club stores. Matt Kistler, Vice President - Package and Product Innovations, Sam's Club Wal-Mart

Part of the challenge in rolling out greener products is informing customers about changes that affect their perception of savings. Wal-Mart's April 2008 "Earth Month" promotion is highlighting its greener products and informing customers how making better choices, especially on a large scale, can cause a difference. Wal-Mart is featuring more than 50 products in stores and 500 online, from transitional cotton shirts to mulch made from rubber to Clorox Green Works products.

The majority of Wal-Mart's environmental footprint comes from suppliers. The company has direct control on about 8 percent of its footprint, with the remaining 92 percent coming from its supply chain.

To green its supply chain the company launched a it's "Wal-Mart Packaging Scorecard" in 2007 . By filling in information about products' packaging, suppliers are rated and find out their rank in relation to peers. Kistler said Wal-Mart works with suppliers, telling them what they can do to improve and let them know what other suppliers have done to reduce packaging.

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