In Episode 78 of The Wendel Forum (originally aired on September 29, 2012, on 960 KNEW AM radio), show moderator Dick Lyons, co-founder of Wendel Rosen’s sustainable business practice group, welcomes Scott Potter, managing partner of San Francisco Equity Partners, a private equity firm that specializes in consumer products growth companies.

Scott Potter of San Francisco Equity Partner

Scott Potter, San Francisco Equity Partners, in The Wendel Forum studio

Potter’s firm partners with companies that have demonstrated a proven demand for their products.  So while there’s no consumer adoption risk, the companies are usually facing operational and scale challenges to reach the next level. Typically, they are $5-10 million companies poised to scale their businesses, often to north of $100 million.

Identifying these optimal risk-reward companies is more science than art.  San Francisco Equity Partners is particularly focused on its companies’ channel strategy.  That is, a given beauty product can’t successfully be sold at both Sephora and Wal-Mart.  Channels include food (Safeway), drug (Walgreens), mass (Wal-Mart), club (Costco), prestige (specialty retailers and department stores) and direct-to-consumer (online and direct-response TV).  Determining the right channel for products is often a company’s key to success.

A growing channel is the so-called natural channel, as epitomized by Whole Foods, which is separate from the traditional grocery channel.  But Potter’s firm specializes in natural products that are targeted for the mass channel.  Companies targeting this channel should not ask consumers to pay more for an inferior product “just to save the fish,” Potter says.  Rather, the product’s value proposition has to work in and of itself outside of sustainability and natural missions.  The prime example is Method products.

When San Francisco Equity Partners first invested in Method, it was producing just hand and cleaning products.  It has evolved to include bathroom and specialty products and even successfully launched into the competitive laundry space.  Early on, Method knew it would never have the marketing budget of Proctor & Gamble.  So it chose to overinvest in packaging, focusing on the point of sale: when product is on the shelf.  Method’s in-house design team devised a distinctive look, including the bottle molds, and focused on the aesthetic and the user-experience (such as the one-hand laundry detergent dispensing system). With the “design baked into the products,” Method aspired to be like Apple.

At what kind of store are you most likely to purchase natural products?

Post Links:

Listen to the interview with Scott Potter: Episode 78 of The Wendel Forum (27:48 mins; mp3)

San Francisco Equity Partners Website: http://www.sfequitypartners.com

Method Products Website: http://methodhome.com

960 KNEW AM Radio website: http://www.960KNEW.com

Dick Lyons’s online profile: http://www.wendel.com/rylons

In Episode 56 of The Wendel Forum (originally aired on March 31, 2012, on 960 KNEW AM radio), show host Dick Lyons speaks with Paul Baier, Vice President of Sustainability Consulting at Groom Energy.  Paul assists the company’s customers with their sustainability and energy reduction strategies, carbon footprint and responses to supply chain surveys.

Paul Baier of Groom Energy

In addition, Paul authors a sustainability blog called Practical Sustainability and moderates EnterpriseSmartGrid.org.  He is a senior contributor and VERGE Global Advisory Board member for Greenbiz.com and is the primary author of a report on large enterprise smart grid and energy management software called “The 2011 Enterprise Carbon Accounting (ECA) Software Market: A Buyer’s Guide.”  Paul sits at the forefront of issues related to large scale energy use by major organizations.

Dick and Paul discuss how large companies grapple with energy management and reduction – not an easy task.  These companies face many challenging when it comes to energy and carbon measuring, management and reporting.  First, they have to figure out what to track, then how.  Most are responding to regulatory demands, need for better cost savings and what Paul refers to as “consumer compliance.”

Often the first step is trying to put their arms around what energy use really means in their business.  Some companies are surprised that, in addition to improving their sustainability footprint, they can save significant amounts of money by implementing energy management initiatives.  Once they realize that, most are prepared to put significant resources to the task.   For many manufacturers and distributors, powerful companies like Walmart put pressure on them to complete rigorous supplier surveys to explain their strategies and results. 

For single-facility operations it’s hard enough, but many of these suppliers have facilities around the globe, each with different standards, measurement systems, accounting systems and processes for collecting and tracking the information ultimately needed to institute a company-wide program.   Paul helps these companies manage this complex process.  

Helping companies to identify direct effect, indirect effect, and the overall impact in supply chain (Scope 1, scope 2 and scope 3), Paul observes that companies are becoming more sophisticated in identifying the hidden impacts of the entire supply chain. 

Management people have been trying to anticipate cap and trade, carbon tracking, and what will happen as AB32 (in California) and other legislation dictates change for their industries.

As Paul says,

“Energy management is the flip side of carbon management.”

Paul and Dick discuss the types of providers who are stepping into the marketplace and the kinds of risks that various vertical markets must address in their forecasting models. The technologies being developed today will allow greater and greater precision and flexibility in tracking both the carbon footprint and the energy management of our major industries.  And with the rise of cloud computing, the storage and processing options continue to become more affordable for even smaller companies.  Paul suggests that because of the software, data storage and other advancements in recent years, precision energy management is no longer a technical problem, it’s a “willingness problem.”

Certainly the regulatory environmental, as well as consumer demand will continue to influence the willingness of companies to address these issues in significant ways.

  

Post Links:

Listen to the interview with Paul Baier:  Episode 56 of The Wendel Forum(27:44 mins; mp3)

Groom Energy website: www.groomenergy.com

Paul Baier’s blog: http://practicalsustainability.blogspot.com/

GreenBiz.com website: http://www.greenbiz.com

Report link: http://www.groomenergy.com/eca_report_summary.html

960 KNEW AM Radio website: http://www.960KNEW.com

Dick Lyons’ online profile: http://www.wendel.com/rlyons

In Episode 55 of The Wendel Forum (originally aired on March 24, 2012, on 960 KNEW AM radio), show host Dick Lyons welcomes Gil Friend to the show.  Gil is Founder, President and CEO of Natural Logic, a company that provides strategic advice to support the sustainable economy.  He’s been consulting in this area for more than 40 years and has some great perspectives on the past, present and future of sustainability in business.  His company serves a wide variety of organizations ranging from municipalities to some of the best known consumer brands in the world (Levi Strauss and CocaCola, to name two).  He was recently inducted as a founding member of the Sustainability Hall of Fame by the International Society of Sustainability Professionals.  This is a guy with, as they say, gravitas in the industry.

Gil Friend of Natural Logic

Gil Friend of Natural Logic visits The Wendel Forum studio

Gil points out that, classically, people have defined sustainability as development that meets the needs of present generations without compromising the ability of future generations to meet their needs – or to put it more succinctly, by doing less bad.  

He prefers to take a more positive approach.  In his view, a sustainable business is a business that operates in harmony with the laws of nature – a little more inspiring.

When asked what major trends he’s seen, Gil shares that he believes there has been a major sea change in the last five years, with a large number of mainstream businesses considering the environment as a part of their core business operations.   Most of us are familiar with at least some of the ways in which Walmart has led the pack in this area.  When they started, a few years ago, they set goals without knowing exactly what the metrics would be or how they would meet them.  But they didn’t let that stop them, and as a result they have had a big impact on a large sector of the economy.

Gil believes that sustainability has moved from the periphery of business operations to become a central driver of business value for many companies.  Early efforts tended to focus on energy, waste stream, water usage and similar factors.  What’s the latest?  Carbon emissions.  Companies are developing metrics for things like carbon emissions per dollar of revenue as a way to think about investment strategies.  One resource in this area is the Carbon Disclosure Project

Common sustainable business themes include companies looking more closely at the full length of the supply chain and adding transparency.  Consumers want to know the materials that make up the products they buy, as well as the labor practices employed and environmental impact of their production. 

What’s in Gil’s crystal ball for green business?  He sees more companies taking sustainability further and more deeply into their operations.  Companies are asking more systemic questions – embedding sustainability deeper into their DNA and developing better processes along the way.

For more of Gil’s insights, you might want to check out his book, The Truth About Green Business.  It gives business leaders a framework, as well as practical nuts-and-bolts ideas, in easily digestible pieces. 

Post Links:

Listen to the interview with Gil Friend:  Episode 55 of The Wendel Forum (27:38 mins; mp3)

Natural Logic website: www.natlogic.com 

The Truth About Green Business webpage: http://www.natlogic.com/resources/publications/the-truth-about-green-business/

Carbon Disclosure Project: https://www.cdproject.net/en-US/Pages/HomePage.aspx

960 KNEW AM Radio website: http://www.960KNEW.com

Dick Lyons’ online profile: http://www.wendel.com/rlyons

Bill Acevedo

Usually, the most revolutionary ideas are those that address the most “simple” problems.  One aspect of sustainability that is seriously overlooked, but often complained about, is packaging.  Boxes, bags, wrappers, bags in boxes – you name it.  Excessive packaging is everywhere from food to toys to everyday household goods.

Some companies, like Ecologic Brands, Clif Bar, and Walmart are changing the way the goods that we buy are packaged.  In 2006, Walmart introduced a packaging scorecard with the intention of improving packaging design, conserving resources, and reducing packaging along its global supply chain by 5% by 2013.  The results have been impressive with packaging design breakthroughs from many Walmart suppliers.

Clif Bar, for its part, recently introduced The Climber wine pouch.  Clif Bar boasts that it has an 80% lower carbon footprint than two glass bottles, it is 90% less waste than said bottles, and best of all  it reseals and keeps your wine fresh for up to one month after opening.  That is a breakthrough!

And, this week’s guest on The Wendel Forum radio show, Ecologic Brands (http://www.ecologicbrands.com/)  is re-thinking the way that common household supplies such as milk and laundry detergent are packaged.  Using recycled and recyclable (i.e., you can recycle it again) cardboard, Ecologic Brands is swapping out the plastic that clogs landfills and our oceans.  The bottle is composed of an outer cardboard paper shell and a recyclable plastic liner.  The liners are made of 70% less plastic than your average jug.  If you have kids, or if you play as a hard as you work, you know how much of an environmental benefit it is to have laundry detergent bottles like these.

But don’t take my word for it.  Tune your radio (or computer) to Green 960 AM at 11:30 this Saturday morning to hear Ecologic Brand’s CEO, Julie Corbett, tell you all about her revolutionary idea to address the way we package everyday household goods.

In Episode 3 of The Wendel Forum on Green 960 AM, which originally aired on Saturday, February 19, Dick Lyons contemplates how green initiatives at Walmart can serve as a model for businesses large and small. What lessons can smaller businesses learn by looking at the initiatives of the first major U.S. retailer to actively and purposefully address environmental impacts in its supply chain?  Can Walmart’s initiatives with its massive supply chain be scaled down to “green” your own more limited supply chain?

At Wendel Rosen, a part of our journey to become a green law firm meant that we pushed on our own suppliers to carry more environmentally-friendly products and at more favorable prices (something that became easier over the years as more customers desired these types of products and more suppliers entered the marketplace — supply and demand). We also spent a lot of time educating partners, including our office building landlord, to help them understand our goals and to encourage them to implement changes in energy use, facilities maintenance, and waste stream management that would benefit the landlord, as well as the firm. By taking the time to form these partnerships, the impact of our decision to run a more environmentally friendly practice has had a ripple effect beyond our business. Now many of our suppliers, service providers, clients and even competitors have taken steps toward sustainability that might not have happened without the firm’s leadership. We have been one of many businesses moving in this direction, but we’ve seen with our own eyes how  the efforts of a single firm can create a ripple effect in a local economy.  The take away is that you may not be Walmart, but don’t underestimate what you can do with your own network of business relationships.

What advice or best practices would you share with a business looking to make its supply chain more environmentally sustainable?

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