By Rob King, CEO and co-founder, Zedify
The retail trade sector employs over 4.9 million people in the UK making it the country’s largest employer. However, and particularly with the rise in ecommerce over the last few years, it is also one of the biggest polluters.
Data from the British Business Bank shows that the retail supply chain is one of the biggest contributors to UK greenhouse gas emissions and carbon emissions due to ecommerce logistics are forecast to hit around 25 million CO2 metric tonnes by 2030, according to Statista.
And so quite rightly, the industry is under renewed pressure from government, and from consumers, to engage in more sustainable business practices. Our research with Unidays shows that over 80 percent of Gen Zers are prepared to pay more for sustainable goods and services, while brands rating highly on the Kantar Sustainability BrandZ Index grew brand value by 31% year on year, showing that businesses taking sustainability seriously are outperforming those that are not.
This shows how being more sustainable is not only good for the planet; it can boost retail sales too. It’s why companies including Primark joined the UN Fashion Industry Charter in 2020, committing to a 30 percent reduction in greenhouse gas emissions by 2030, promising to double the number of products using recycled materials to 40 million and introducing an in-store recycling scheme for customers. So, how can other UK retail businesses follow suit and what can they do to become more sustainable this year?
Address the last mile
The World Economic Forum predicts demand for last mile delivery (from warehouse to customer) will grow 78 percent by 2030 due largely to the explosion of ecommerce over the last decade. As a result there has been a big increase in van journeys, particularly in our cities, which is having a big impact on carbon emissions and air quality.
And so the last mile has become a highly polluting part of the supply chain. Electric vehicles have been positioned as the answer, but in reality they only save 30 percent on carbon emissions compared to their diesel equivalents, which just won’t get us to net zero. So follow the likes of Zara and consider more sustainable carbon saving delivery options, including cargo bikes, which slash carbon at the source, making any business model inherently more sustainable.
Offer PUDO for delivery and returns
A PUDO (“Pick Up Drop Off”) location is a designated place for the collection of parcels and possible returns. Typically, PUDOs are available through a parcel locker system in public areas next to supermarkets and petrol stations and in any other place that experiences high volumes of traffic.
The majority of online shoppers still prefer home delivery, so click and collect locations and lockers are not a silver bullet when it comes to sustainability. However, if placed in the right locations they can help reduce emissions, as well as making consumers feel like they have more control over returns in particular. After all, we know customers are looking for retail businesses who can prove their sustainability credentials and so, much like offering cargo bike deliveries, having a PUDO delivery and return option will appeal to them, not to mention the flexibility and convenience they offer.
Review your returns policy
According to The British Fashion Council’s Institute of Positive Fashion, 23 million returned garments were sent to landfill or incinerated in 2022 alone. This generated over 750,000 tonnes of CO2 emissions and Keep Britain Tidy estimates 10,000 items of clothing are thrown into landfill every five minutes in the UK.
With online returns in the UK predicted to increase by 27.3 percent in the next five years, it is a big problem and retailers need to address it, fast.
The most common reason for UK returns is size and fit; in the absence of being able to try clothes on in a physical store, many shoppers buy one size up and one size down knowing they can safely return the sizes that don’t fit at no cost.
Returns experts ReBound and sizing experts My Size ID help businesses identify ways that the online shopping experience can help improve the accuracy of sizing, while some retailers are identifying their serial returners and starting to charge fees for returns.
There’s also mounting evidence that longer return policies can surprisingly lead to lower incidents of returns, while there is also an opportunity for retailers to start educating their customers about the true environmental impact of returns.
The future
By addressing last mile logistics, considering PUDO options and overhauling their returns policies, UK retail businesses can go some way to reducing the environmental impact of their operations in the coming years.
Making headway on net zero targets and taking steps to improve sustainability across the supply chain will also appeal to increasingly environmentally conscious consumers. These consumers are increasingly prioritising businesses who not only have sustainability at their core, but can prove the effectiveness of their environmental policies.
