Current research shows consumer priorities have shifted over the past nine years, representing a big opportunity for furnishings retailers.
As the sustainability movement has evolved, consumer attitudes surrounding sustainability have changed. Recent research by the Sustainable Furnishings Council (SFC) suggests that home furnishings retailers and manufacturers now have a potent opportunity to address these changes, better engage consumers, and serve pressing societal needs.
The Sustainability Umbrella
Since the SFC was founded 12 years ago, a number of causes have come to be associated with the sustainability movement, including climate change, healthy living, environmental safety, animal rights and social equity. Sustainability is an umbrella term, and it’s important to keep in mind that each customer has his or her own personal concerns regarding sustainability.
SFC's research targets people who purchased home furnishings over a 12 month period and match the profile of those likely to be shopping for their homes; homeowners, aged 30-60, with at least $50,000 in annual income. Consumers were queried on a range of sustainability issues and asked how concerned they were about each. When SFC started researching in 2009, approximately half the women we interviewed were worried about a range of issues, from climate change to extinction of species, to indoor air quality.
By 2017, that number had nearly doubled with just about all respondents worried about a range of issues. The updated study reveals a large shift. When consumers were asked about their own experiences with indoor air quality and weather-related disasters, 94 percent said they believe hazardous indoor air quality is an issue, and 30 percent said they, or someone in their household, are directly affected. Eighty-three percent said they believe global warming is an issue, and 33 percent said they’ve had personal experience dealing with the issue. They are worried about these problems because they are suffering the consequences.
Sustainability & The Hierarchy Of Furnishings Needs
The consumers SFC survey already know that driving less makes a difference in carbon dioxide pollution, as does adjusting thermostats, drinking less bottled water and shopping differently. When shopping for home furnishings, sustainability is not the top most concern on their list. Their responses predictably reveal they shop first for style, quality and price points that suit them best. But, over 90 percent express interest in buying environmentally safe home furnishing provided the cost and style is similar to other options. Half of them are willing to pay more for eco-friendly products. The premium they will pay is modest, only about 10 percent. That is the same they often say they will pay for attributes other than eco-friendly, such a brand they favor.
Looking at how consumers' priorities have shifted over the years, we also see a great deal of concern now over toxic waste pollution as a specific issue, but more significant is that consumers are registering their concern through their product choices.
Using Concern As An Engagement Tool
Shoppers’ concerns can and should be considered by retailers as engagement tools. If your sales staff is aware that 94 percent of the shoppers who walk into furnishings stores are concerned about indoor air quality, they can when appropriate, add a sustainable product feature/benefit to their presentations. Furnishings may include VOCs, flame retardants and other compounds (see below) that may be of concern to shoppers. This can make a difference in closing a sale or outselling an online or brick and mortar competitor.
Likewise, knowing that 83 percent have at least some inkling that there is a connection between carbon footprint and weather disasters, your sales staff may be able to point out products made by companies who share their concerns through a commitment to lowering their environmental footprint.
Complex Supply Chains
We do business in a global market place, and furnishings products have a complex supply chain. Raw materials may come from one continent, be processed on another into a furniture component, be shipped to a third manufacturer for assembly, then shipped once again for final sale. A robust sourcing policy will help you manage this complex supply chain. It will give your sales staff confidence, and empower them to engage consumers with a story that differentiates your retail operation through your commitment to implement best practices for sustainability.
Elements Of A Robust Sourcing Policy
The SFC can provide support and tools for companies to create robust wood sourcing policies, and help them determine what harmful chemicals might be in the products they buy. In 2017, SFC announced the "What's it made of?" Initiative to encourage transparency in supply chains and stimulate innovation to reduce harmful chemical inputs into home furnishings.
Working in partnership with the American Sustainable Business Council, the Center for Environ-mental Health, and Parson's The New School Healthy Materials Lab, five harmful substances commonly found in furnishings products have been identified. VOCs like formaldehyde are found in many finishes and glues; flame retardant chemicals may be present in foams and fabrics; highly fluorinated stain treatments are sometimes applied to fabrics; antimicrobials can be incorporated into mattresses and textile constructions; and PVC, also known as vinyl, is found in faux leather, fabric backings, and many other products. The initiative includes a simple "Pledge to ASK". Industry professionals can find this pledge at sustainablefurnishings.org, and can also make use of a Supply Chain Questionnaire, which helps clarify what might be in the products they specify. So far, over 300 industry professionals have begun probing their suppliers to get good answers to that key question, "What's it made of?"
Harmful chemicals can be found in a range of furnishings products and components, so industry professionals frequently turn to SFC to ask, "Where to start?" The simple question, "What's it made of?" can set you on the path to providing your customers with more environmentally safe products. Once you learn what is in your supply chain, you can set your priorities and create a robust purchasing policy. Knowing you care will also inspire your suppliers to bring you more alternatives in future seasons.
Since healthy forests are key to climate regulation, the SFC also has an initiative to support companies that want to reduce their contribution to the problem of deforestation.
Other Ways To Reduce Environmental Footprint
Even before your next trip to Market, there are things to do in stores and offices to reduce a corporate environmental footprint.
Recycling: To start with, make sure you recycle as much as you possibly can. Do you have more recycle bins than trash cans? Are you recycling all packaging waste? Many companies save money and other resources by inviting their local solid waste facility to provide a free assessment. Since overcrowded landfills are a problem in every community, these pros are happy to help you figure out how to throw away less.
Electrical Usage: Another simple step to reduce resource consumption is to cut electricity consumption. Is your HVAC system running as efficiently as it can? Are you burning the most efficient and long-lasting light bulbs available? Using less electricity will save money while cutting CO2 emissions. Since the grid is overstretched in every part of the country, your local utility will be happy to provide an assessment.
While you are at it, consider if you can make use of your roof. Will solar panels work for you? If not, how about installing a green roof? Either would give you much to discuss in your marketing campaigns, while also making a big difference in sustaining a healthy future.
Transportation: Interestingly, transportation emissions recently overtook emissions from electricity production in the U.S. Most stores can reduce transportation emissions by planning more efficient delivery routes and choosing the most efficient delivery trucks available. But you can also make a difference socially when you encourage employees to use public transportation and to carpool. You will find they appreciate working for a company that encourages and rewards a lighter carbon footprint.
Sustainable Marketing Ideas
Some people set out to change the world through sustainable practices. A few adopt sustainable practices to increase sales, but most are somewhere in between. Here are five ways SFC’s retail members have leveraged their sustainable inclinations to create branding buzz:
Circle Furniture: Boston-based Circle Furniture capitalizes on their conviction that a healthy home starts with a healthy environment. Circle shops their sustainable values and communicates these values to their customers.
Sklar: Sklar in Boca Raton has sent several staff members to SFC's accredited training, GREEN-leaders, and advertises that they have GREEN Accredited Professionals on staff, to answer customers questions.
Gallery Furniture: Gallery focuses on buying American-made. The company communicates the advantages of that choice, including less pollution in production and transport, as well as support for the local economy.
Domaci: Bethlehem Pennsylvania -based Domaci runs a series of #SustainableSaturday. See https://domacihome.com/blogs/domacidispatch/sustainable-
saturday for details.
Lawrance Furniture: Lawrance Furniture in San Diego includes a long list of their sustainability initiatives on their website as well as in-store signage.
What Are The Largest Home Furnishings Retailers Doing?
Furniture is the third largest user of wood resources, behind construction and paper production, so it is clear we have some responsibility to save the forests of the world. It has often struck us at SFC that companies might not know how to actually take responsibility. SFC, therefore, took a look at how wood and wood furniture are sourced in our industry.
Working with National Wildlife Federation, SFC engaged with some Top-100 home furnishings retailers regarding their wood sourcing policies. The results are published on a dedicated website (https://furniturescorecard.nwf.org/scorecard/). Of the 57 companies studied, seven scored in the Top Tier. Another six earned enough points to score honorable mention, and an additional two companies signed a pledge to make use of the available resources to improve their policies, and so their scores. As a result of the initiative, to date 12 companies have improved their scores, a significant percentage for the industry's impact.
What Can Smaller Companies Do?
SFC offers free guidance and resources for companies of any size that want to review their wood sourcing policies. More information can be found at https://furniturescorecard.nwf.org/scorecard, and at https://sustainablefurnishings.org/resource-library/search?combine=&topic=232. Further, using the guidance above, we suggest you talk about your purchasing policy from the moment you develop it. You will find yourself in as many interesting conversations for consumer engagement as for supply chain management.
This month, SFC celebrates 12 years of existence with the annual Open Membership Meeting during High Point Market. The first step toward reducing energy consumption, better managing supply chains, and inspiring others to take action, can be the hardest, but it’s also the most important.
The World Economic Forum has identified climate change as the greatest threat to the world economy. It may be more of a threat to our home furnishings businesses than many in our industry have realized. Not all of our customers are concerned, but SFC research has shown that most are. Some sustainable practices add to cost, but others reduce operational expenditures and create marketing and sales opportunities that will only increase over time.
About Susan Inglis: Susan Inglis is Executive Director of the Sustainable Furnishings Council, and resident expert with the organization she helped found in 2006. She has led SFC to work with industry leaders to establish criteria to gauge the sustainability of furniture products and practices; develop programs for educating all sectors of the industry; and attract hundreds of companies to membership.
Inglis is also founder and owner of From The Mountain, a company that imports hand spun cashmere yarn from Afghanistan, providing safe income for over 100 women there. Inglis serves on the Board of the American Sustainable Business Council and was awarded a 2017 Visionary Leadership award by the NC Business Council.
About The SFC: SFC member companies make a public and verifiable commitment to sustainability, to transparency, and to continuous improvement. Visitors to http://sustainablefurnishings.org can research companies, visit SFC member companies’ websites, and make use of a rich resource library.
About Giles Jackson: Prof Jackson teaches sustainable business strategy at the AACSB-accredited Byrd School of Business at Shenandoah University and wrote among the first doctoral dissertations on the topic of business and sustainability twenty-five years ago at Virginia Tech. A practicing entrepreneur, he previously held executive positions in the wind energy and manufacturing sectors and recently completed a graduate course in environmental management at Harvard University. Giles serves on the international advisory board of a UNESCO biosphere reserve in Vietnam and on the standards committee of the Sustainable Furnishings Council. He's currently writing an article on ecotourism for the Oxford Research Encyclopedia of Environmental Science and now offers bespoke courses in sustainability worldwide. Contact him with questions or comments at email@example.com or 202- 257 -4854.
Sidebar #1: Purpose Driven Sales
by Giles Jackson, Ph.D.
Purpose-driven sales are on the rise. A third of global consumers now choose to buy brands based on their social and environmental impact, according to Unilever’s recent survey of 20,000 adults across five countries. Crucially, the fact that their claims were backed up with information on real purchasing decisions shows that the “say-do” gap is closing. Moreover, one in five respondents said they would choose a brand if its sustainability credentials were made clearer on packaging or in marketing.
An estimated $1 billion opportunity exists for brands that meet this need, says Unilever.
"These are the Millennials and they have a completely new set of values. 'They want committed brands with authentic products.'”
This is borne out by the group’s own financial performance. Of its hundreds of brands, those that have integrated sustainability into their purpose and products, such as Dove and Ben & Jerry’s, delivered nearly half the company’s global growth in 2015. "Sustainability isn’t a nice-to-have for businesses," says Keith Weed, Unilever’s Chief Marketing and Communications Officer -- "it’s a strategic imperative."
There are multiple factors driving this, foremost among which is a major demographic shift. Global Millennial spending power is set to overtake generation X by 2020 and will continue to rise. That matters because the lifestyle and consumption patterns of this group (aged 22 to 37 years old) are different. As Emmanuel Faber, chief executive of Danone, put it: “Consumers are looking to ‘pierce the corporate veil’ in our industry and to look at what’s behind the brand.” These are the Millennials and they have a completely new set of values. “They want committed brands with authentic products,” he says. “Natural, simpler, more local and if possible small, as small as you can.” Since these values transcend product categories, this should play well for American furniture companies that pay attention to these trends.
Sidebar 2: Sustainability Price Tag
by Giles Jackson, Ph.D.
Recently, according to a survey of 30,000 adults by Accenture and Havas Media Group, people think business is as accountable as governments for improving their lives. Yet seventy-two percent say that business is failing to take care of the planet and society as a whole. The point is that while brands and companies impact positively on people’s lives, this comes with a sizable price tag. According to The Sustainability Consortium, global production and use of consumer goods accounts for more than 60 percent of all greenhouse gas emissions, 80 percent of water usage, two-thirds of tropical forest loss, and 75 percent of forced and child labor. Nearly 20 percent of industrial water pollution comes from textile dyeing and treatment, and if current trends continue, 2.2 billion tons of municipal solid waste will be generated annually by 2025. Furniture waste (f-waste) alone is an 8.5 million-ton annual trash problem in the U.S., according to Waste360.
"As technology accelerates product life cycles -- pushing fast fashion into more and more product categories -- these impacts are likely to worsen."
What will happen as nearly 2.5 billion more people join the global consuming class over the next few decades? The benefits provided by our consumer goods will come with an increasingly sizable sustainability price tag. Moreover, as technology accelerates product life cycles -- pushing fast fashion into more and more product categories -- these impacts are likely to worsen. It doesn't have to be this way. Incentivizing and supporting manufacturers and their suppliers to design more sustainable products, as SFC is doing, is one of our biggest levers for driving sustainability in the furniture industry globally.
Image credit: The Sustainability Consortium®, copyright 2016 Arizona State University and University of Arkansas. The Sustainability Consortium (TSC) is a global non-profit organization working to transform the consumer goods industry by partnering with leading companies to define, develop, and deliver more sustainable products. For more information visit www.sustainabilityconsortium.org.
Sidebar 3: The Circular Furniture Economy
by Giles Jackson, Ph.D.
photo credit Concept of a Sustainable Society: The Comet Circle™ (above) has been
reproduced with permission. Copyright© 1994 Ricoh.
The global economy has long run on a linear, “take-make-dispose” model. Taking inspiration from nature, the emerging “circular economy” model redefines waste as a material input. Accenture estimates that shifting to the circular economy could open up $4.5 trillion in new economic potential by 2030. In an era of volatile input prices, this model makes practical sense. Business leaders are exploring whether greater resource productivity can help them protect their margins, and governments are getting on board.
According to the Institution of Environmental Sciences (IES), there are at least three good reasons for shifting from a linear model to a circular one. First, existing recovery systems are suboptimal. For example, in mobile phones, only 17 of the 40 elements used in their manufacture are recovered at all, with the rest ending up in slag, even in the best recycling plants. And according to the Global Commission on the Economy and Climate, 95 percent of plastic packaging material value - $120 billion annually - is lost after first use. This is not only environmentally damaging, it’s also terribly uneconomical.
Second, the environmental burden of products is shifting upstream, from consumer use towards manufacturing. For example, around 75 percent of carbon emissions from electronic devices are generated before they are sold. “This means that keeping products in use for longer, or recovering and reusing them, is the best means of reducing environmental impacts,” says IES. Third, by decreasing the use of virgin materials, a circular economy can dramatically reduce emissions and negative environmental impacts. For example, the embodied carbon in recycled aluminum is typically one-tenth of that of virgin aluminum. In addition, reuse or recycling avoids mining waste risks, such as those relating to red mud in aluminum production.
"This spirit of deep collaboration is also evident in Sweden, where 30 players in the furniture sector have joined forces to effect a paradigm shift."
While conducting research for my dissertation on business and sustainability, I happily stumbled across The Ricoh Group’s Comet Circle™ model, which shows how Ricoh and its partners (suppliers, customers and recycling companies) put principles into practice.
The cycle begins with materials suppliers (see graphic on previous page) that harvest materials from the natural environment. These are converted into a product (such as a multifunction printer/copier) that is sold to customers and maintained for as long as possible. “The Ricoh Group puts priority on reusing and recycling products and parts, expressed as the inner loops of the Comet Circle, to return used products to their highest economic value,” says the company. “When a part cannot be reused in a product, we will recycle it as a material. In such cases, we make every effort to recycle the part into a material with a quality as high as possible or to recycle it in the closed loop recycling system, or a system which allows the recycled material to be used within the Group, thereby achieving the highest possible economic value. We also repeat recycling as many times as possible under the ‘multi-tiered recycling system’ to reduce the need to use new materials and ultimately reduce the volume of waste generated.” In Ricoh’s world, nothing but shredder dust reaches the landfill.
Such initiatives are commonplace in modern day Japan. Japan’s lead is largely explained by the old adage, “necessity is the mother of invention.” In a small, industrialized and resource-constrained country, economic survival depends on doing more with less.
From Wehler’s of Denmark to Emeco in the U.S., there are countless examples of enterprising companies salvaging everything from fishing nets to aluminum, to make furniture for the modern world. The question, as ever, is how to scale things up. One lesson from Japan is that governments need to help design circular systems, so that businesses can design circular products and services. In Japan, the law requires consortia of manufacturers to run disassembly plants, ensuring they directly benefit from recovering materials and parts. “Companies therefore invest for the long term in recycling infrastructure,” explains IES. “And because they own both manufacturing and recovery facilities, companies send product designers to disassembly factories to experience the frustrations of taking apart a poorly designed product. Some companies even put prototypes through the disassembly process to make sure they are easy to recover.”
This spirit of deep collaboration is also evident in Sweden, where 30 players in the furniture sector have joined forces to effect a paradigm shift. With a sizable grant from Vinnova (Sweden’s Innovation Agency), a platform for a large-scale transition to circular business models is being created, including devising systems for labeling and certifying reused furniture, engaging customers around procurement and securing circular processes on the part of manufacturers.
"There are countless examples of enterprising companies salvaging everything from fishing nets to aluminum, to make furniture for the modern world."
Furniture World is the oldest, continuously published trade publication in the United States. It is published for the benefit of furniture retail executives. Print circulation of 20,000 is directed primarily to furniture retailers in the US and Canada. In 1970, the magazine established and endowed the Bernice Bienenstock Furniture Library (www.furniturelibrary.com) in High Point, NC, now a public foundation containing more than 5,000 books on furniture and design dating from 1620. For more information contact firstname.lastname@example.org.