15 October 2008

Editorial: The way we do business now

Here's an editorial I wrote for a supplement to Home Channel News last month.

There can really be no doubt any longer. "Energy efficiency" is not a buzzword or a fad. It's the way we do business.

Take appliances. According to NPD Group energy efficient dishwasher sales are up 3 percent, while non-efficient washers are down 12 percent. For refrigerators, efficient ones are up 15 percent; non-efficient, down 11 percent.

A study from the Association of Home Appliance Manufacturers recently said that major appliances are getting more and more water and energy efficient. Refrigerators, dishwashers and clothes washers account for a 43 percent combined decrease in energy consumption since 2000.

And according to a survey by the Research Institute for Cooking & Kitchen Intelligence, 10 percent of homeowners refused to remodel their kitchens with products that harm the environment, and another 36 percent felt strongly about the eco-impact of their purchases.

Consumer attitudes are changing, and homeowners are adding new factors to their buying decisions, factors like carbon footprint, harm to the environment and, most of all, the money they can save by conserving energy. As consumers change the way they look at purchasing decisions, it may pay retailers and suppliers to be open to new options.

One of those options is solar. According to Energy Business Reports, from 1999 to 2007, solar power capacity grew by 962 percent; just from 2006 to 2007, 45 percent. Granted, the total contribution from solar is still very low, but the growth potential is huge. Don't take my word for it ...

• IKEA is researching solar panels for homeowner purchase, and expects to have products in store in three to four years. The Swedish home decor giant is putting $77 million into research and development for solar products.

• Utah-based Woodside Homes, a Utah-based home builder, will be building 1,487 new solar-powered homes in Sacramento, Calif. And that's just one of ten similar deals the municipality has put together.

• Another home builder, Cambridge, Mass.-based S+H Construction, has opened a Renewable Energy Division to sell and install solar and geothermal systems. They also handle all the paperwork needed to get the customer rebates Massachusetts is offering those who install the systems.

It's not a sure thing, but if energy prices stay high, if Congress keeps giving tax breaks to green home improvements, and if the technology keeps improving, then solar will be for tomorrow what low VOC paint and certified lumber is for today. That new business offers an opportunity: Someone is going to be selling solar energy systems to builder customers.

Now, I'm not saying that energy efficiency only applies to big-ticket items, like major appliances and solar panels. There are other profitable ways to piggy-back on the trend, one small-ticket item at a time.

For examples, check out any number of energy saving tips online. These lists aimed at consumers, but many of the tips lead shoppers right into their local hardware store or home center. Here are a few tips that I found on both the DOE's Energy Savers site and on the Sierra Club's Smart Energy Solutions Web page: Replace incandescent bulbs with compact fluorescent lights. Replace old appliances with more efficient models. Buy solar-powered and motion-detection outdoor lights. Each of these tips — and many others — is a selling opportunity.

But energy efficiency can help home channel dealers closer to home, or closer to store, anyway. Bottom-line boosts can come from the operations side as well as from the sales side. Paint company Dunn-Edwards is building a LEED-certified coatings technology center in Los Angeles. Ace Hardware is limiting the top speed on its trucks to 67 miles per hour -- and has saved about $1 million just so far this year. Installing LEDs and new HVAC systems, Home Depot has cut energy consumption in its stores by 12 percent. Lowe's has cut its energy costs by 40 percent with upgraded lighting and skylights.

The debates over the energy crisis and the environment are playing out in the voting booth and the courts of law, science, and public opinion. But some facts are beyond debate: Big and small players in the home channel are not going green because they want to save the whales or the polar bears or the planet. They see greenbacks in the green market, and cost efficiencies in energy efficiency.

1 comment:

Michael said...

The kitchen has always been an important place of activity at our houses. People have started giving importance to sophisticated kitchen appliances which have become the basic need of modern kitchens. They like to include these cooking appliances to make their cooking easier and efficient. The latest ones include dishwashers; microwave, electric stoves, and etc.ovens have started offering more than just the basic functions. These microwave ovens can cook your food at the required temperature at minimum time, thus saving your valuable cooking time.