10 Ways to Run a More Sustainable Business
Sustainability in the Decorated Apparel Industry, Part Two
Missed part one? No need to worry — find it here.
In this second installment of this series, I cover actionable ways to make your business more sustainable. If you think this will cost you money, don’t worry, you’re not alone. Several recent studies have shown that while most people struggled to come up with a common definition of what sustainability means, they overwhelmingly felt that it had to be more expensive.
Based upon my own experiences, and with a manufacturing background, I believe that truly sustainable practices can only be found in solutions that deliver positive environmental and/or while driving improved financial results. I think the challenge sometimes is that we may need to rethink how we evaluate possible solutions to see exactly how they will help the bottom line.
No. 1: Count Every Penny
I am not referring to some accounting solution here, but rather a mindset change, which may seem obvious but is not always easily achieved. Can you tell me how much it costs to print an invoice, answer an email, acquire a new customer, or pack an order?
As you evaluate possible sustainable solutions for your business, having this information helps you decide what impact it will have on the bottom line. This is sometimes simple, with things that clearly lower costs, but other solutions you consider may not have as direct an impact, forcing you to think in different terms. The key part of this is that you dive deep into your business, understanding where every penny goes to better decide which solutions work for you.
From a past life there is one GOAT company that stands out, a large wholesale distributor based in Wisconsin who had their costs dialed in like no one else. At one point they informed all their brand suppliers that they would no longer be sending back defective products that had been returned from their customers.
We were a little surprised when they explained that they were not looking for a rebate or discount from us but rather just informing us of a change. When asked for an explanation, they shared their calculations, which included the individual costs of each step in the current process that ended with shipment of the defects back to the brand for a credit. Their calculations showed that if they simply told the customer to keep the defective product and then sent a replacement, they would add six figures to their own bottom line. What hidden gems are there to be uncovered in your business?
No. 2: Understand What’s Being Wasted
One of the easy wins toward more sustainable operations for most companies, especially in manufacturing, can be found in reducing waste. Some waste is unavoidable but understand that all waste adds to your environmental footprint and negatively impacts the bottom line.
There are many areas where your business can generate waste: misprinted shirts, inks wasted at the end of each print run, screens destroyed at the end of each month, or paper in the trash or recycling bin.
I suggest you measure these things and over time, focus on the bigger waste areas and map out possible solutions. Many businesses have even built performance metrics around waste and linked it to employee bonuses to drive improvements.
No. 3: Buy Smarter, Not Just Cheaper
Your single biggest cost is usually the blank garments you print, typically running more than 55% of your overall expenditures. If you’re like most of the businesses in our industry, you spend a lot of time looking for that lowest price, especially on larger orders where margins are often slim. Aside from consuming your time that could be spent generating sales and getting better returns, this single-minded focus is missing the bigger picture.
Here is an example:
You have an order for 5,000 T-shirts to print with a price of $1.35 for Brand X T-shirt and $1.36 for a similar shirt from Brand Y. Just looking at the price you would likely select Brand X and think you were saving $0.01 x 5,000 units = $50.
If you expand and look at the Acceptable Quality Level (AQL) of each brand, you may be surprised. AQL represents the % of defective products that the brand accepts to be putting into the first-quality cartons you are shipped. If you need to ship your customer 5,000 first-quality shirts and Brand X has an AQL of 5%, you need to buy 5,250 shirts to fill the order. If Brand Y has an AQL of 3%, you need to buy 5,150 shirts. Going back to the initial price, you would have to spend $7,087.50 (5,250 x $1.35) with Brand X, and $7,004.00 (5,150 x $1.36) with Brand Y. Aside from saving you $83.50, you will also print 100 less shirts, wasted less ink, reduced equipment wear and tear, and reduced the carbon footprint of processing this order using the more expensive shirt.
No. 4: Think About Energy
Energy consumption is another area to achieve significant positive impacts. If you have not had an energy audit done on your business, get one! Many utility companies and government agencies offer them, and they outline where your consumption is happening and often highlight recommended fixes.
A quick fix here can be found in lighting. If your showroom or office are currently lit with a mix of incandescent and halogen bulbs, simply switching to LED’s can save a lot of money, especially over an extended operating period. Motion sensors in your warehouse that turn the lights off when no one is moving are cheap solutions that reduce your energy bills and lower your carbon footprint.
A sub-tip to this point is to research available grants and subsidies for energy efficiency in your area. The push from the federal and state governments on the “greening” of industry is resulting in lots of money being made available to business to retrofit and add new sustainable solutions in this area.
No. 5: The Four R’s (Reduce, Reuse, Recycle, and Recover)
If you aren’t actively recycling, shame on you! There is absolutely no reason why you should not be doing this stuff. Done correctly, it saves money and helps the environment.
If you are not already recycling wasted inks, that is one area where you can seek out companies in your area that will gladly take in your wasted inks and use them to make black inks and other by-products that can even become something you use yourself.
No. 6: Operational Efficiency
When we think about operational efficiency, we are looking at optimizing the use of resources across the entire business. Getting the most out of your time, capital resources, available capacity, human resources, and supplies can deliver bottom-line benefits and drive more sustainable business.
This can be as simple as looking at your weekly production schedule and putting all the polyester and polyester-blended shirt orders into one day so that you can turn down the temperature in the dryer, which saves money, reduces your carbon footprint, reduces wear on the heating elements in the dryer, lowers the amount of wastage (from cooking polyester shirts at too high a temperature), and probably allows you to run faster on the other days.
No. 7: Add Sustainable Products/Supplies to Your Mix
If don’t already offer your customers a choice of sustainable products or printing techniques, know that someone else is. Almost all your corporate, educational, government, and charity customers either have or are governed by ethical and sustainable purchasing policies, so adding sustainable products or printing techniques can help them meet their own goals. Adding these to your offering can also help differentiate you from your competitors that aren’t.
The most important thing you can do in this area is to educate yourself before you start talking to your customers. If you think the subject matter is complicated, then imagine your customer’s point of view as someone outside the apparel industry.
No. 8: Do it Right the First Time
You already know that fixing mistakes is expensive and often leads to missed delivery times and unhappy customers. As mentioned earlier, your single biggest cost is the blanks you buy, so wasting any should be avoided.
In manufacturing environments, quality controls are important, with metrics like defect and reprocess rates giving you data to help drive more efficient use of human capital, machine capacity, and ensure higher quality. Track things like the number of test prints required and number of defects per print run or changeovers to better evaluate all parts of the business. Monitoring these results down to the individual employee can also reveal training needs or process change requirements.
No. 9: Invest in Technology
It seems like every season some new technology comes out that specifically includes some form of sustainability angle. These either reduce energy use, speed up production time, free up human labor, or deliver the benefits of lowering costs and adding new deliverables to your product/service mix. My suggestion, within your means, is that you look carefully at these and see if they fit your business.
There are already many articles covering these new technologies, but I suggest you start with your own business evaluation and cost exercise. Pick the biggest areas where you think you could be more energy, time, or resource efficient and research those. Make a priority grid with all the pros and cons, then evaluate how they can help your bottom line.
No. 10: Scream it From the Rooftops!
This is an absolute necessity if you are ever going to rationalize the changes necessary to make your business more sustainable. Make these commitments to being more sustainable part of your company’s DNA and tell the world about it.
I recently spoke with a mid-/large-sized online printing company that runs a good business. They take custom printing orders through a website and have spent a lot of money on customer acquisition, marketing, and optimizing the user experience online to ensure their click-through rate and conversion rate is extraordinary.
We spoke about the sustainable things they did as a company, and they listed off several cool things they had in place already and several they were looking to adopt. I was surprised to hear, however, that none of these things were on their website or in their marketing. They explained they had adopted these solutions because they were the right things to do, and they drove bottom-line profitability, not because the company felt it would drive new business.
This was like music to my ears, but I couldn’t help feeling there was some untapped brand equity they were leaving off the table, so I asked, “Do you think telling your customers about it will push any of them away?”
This list is not all-encompassing and may contain things you already do, or that aren’t applicable to your business. I think the most important takeaway is that you open yourself to thinking about sustainable solutions not as a cost, but as a driver of reduced environmental footprint and improved bottom-line profitability.
I once again welcome your feedback and look forward to sharing some more on sustainability in the decorated apparel industry in the next article: firstname.lastname@example.org.