By: Jared Entwistle, Maine SBDC Intern
In the wake of the COVID-19 pandemic, it’s more important for small businesses to think about ways to conserve cash flow. This often presents a dilemma for those who want to be conscious of their carbon footprint: how can I reduce my business’s environmental impact while maintaining a budget?
Many businesses are aware of the impact of things like switching to LEDs. In this blog, we’ll focus on ideas that will produce immediate cost savings with a minimal investment which can also help maintain your commitment to the environment.
Monitor & Manage Consumption
Waste Management: By far the easiest place to start when thinking about sustainability and cost-savings is to take a look at your waste production. Start by reducing the number of trash receptacles and increasing the number of recycling bins. This will help you and your team members to think about what they are throwing out before they actually toss it. Be cautious not to restrict the number and availability of trash cans too much, however, as making it difficult to dispose of trash will likely lead to waste being incorrectly thrown into the recycling bins which can cause processors a lot of problems. The key to saving money here is to reduce your waste enough to lower your monthly collection contract.
Heating Efficiency: It is important to take a look at your heat source. Is it obstructed in any way? Obstructed intake and output vents, baseboards, and radiators can make your system work harder and consume more energy. Has your system been serviced recently? Maintaining your system by flushing supply lines prior to the beginning of the heating season can save you money by allowing the furnace to draw and burn fuel more efficiently. Is your heating or cooling source sized appropriately for your space and usage? Running an oversized system can cause rapid cycling, which reduces efficiency and drives up costs. Likewise, a system that is too small, it will run constantly without producing the heat you need to run a business that’s comfortable for your customers. Ensuring your heating or cooling system is running at maximum efficiency will not only help you spend less on climate control but will help to reduce your business’s environmental impact.
Manage Electricity Usage: To save on electricity, a good first step is to sign up for a monitoring program through your utility provider. Websites, like CMP’s Energy Manager, can help you monitor your electricity usage and offer an energy calculator so you can see how much electricity and money you could save by turning off, reducing the usage of, or changing out your appliances for energy-efficient models. To curb accidental usage of lights, play around with the lighting in your establishment to find what the right operating light levels are for staff and customers. Once you find the best combination of comfort and functionality, encourage your team to turn off any lights that aren’t needed to keep optimum lighting. Labeled switches will help your team recognize when a light is turned on that shouldn’t be and will help reduce accidentally turning on lights that aren’t necessary.
Vehicle Efficiency: If your company relies on vehicles for its operation, a lot of fuel costs can be avoided by maintaining the health of your fleet. Keeping up on oil changes, car maintenance, and tire pressure can help drastically improve your vehicle’s fuel efficiency and decrease your net carbon emissions. As an added bonus, it will save you money on gas, especially as prices start to rise.
Paper & Printing: Consider what you are printing and what needs to be printed. What printed objects can you replace with digital sources? If you’re advertising via printed media, can you switch to digital forms? There are plenty of low-cost or free digital media marketing platforms and our advisors would be happy to talk to you about which ones fit your business best.
Negotiate New Contract Terms
With your consumption in check, it might be a good idea to re-evaluate the level of services you need. It is a good time to start negotiating with certain suppliers to reduce payments, change payment terms, or even reduce services. Do an audit of your company to see what you absolutely need, what you could do without, and what services you have that don’t seem worth it, but are necessary. Arming yourself with this knowledge will help you decide what you can negotiate on. Start with large suppliers, as they are likely to be able to offer you more of a discount than smaller, local businesses.
After a services audit, but before you decide to start negotiating, it may be worth it to see what opportunities exist to partner up with businesses in similar industries or in your local area. With your collective buying power, you may be able to take advantage of cost savings you otherwise would not be able to obtain. If you can find the right partners, it can help reduce your per-item costs, create solid business partnerships, and reduce the cost of shipping. As an added bonus, shipping one large order to a central location can reduce the product miles traveled and helps reduce waste due to packaging. When I was part of the ownership at Flight Deck Brewing, we would regularly partner with other small breweries to buy raw goods, materials, and equipment in bulk as a way to save on freight and to reach the minimums for bulks discount pricing.
Another way to partner up is to combine services with neighboring businesses. You may find that the amount of waste, recycling, and compost your business produces has decreased dramatically and you’re probably not the only one. With waste disposal fees maintaining a single price for a pickup regardless of how much waste you produce, it only makes sense to ensure your bins are full. If you have extra space in your waste bins, partnering with nearby businesses and splitting the costs can help to preserve cash flow. Take a look at your other services too, there may be other areas where you can team up rather easily.
Efficiency Maine
Finally, this last tip is the only one that includes an additional cost, but it’s worth mentioning because the savings can outweigh the costs quickly. Can being the operative word, as you’ll need to analyze these to be sure they will work for your specific situation. Efficiency Maine has a host of incentives for commercial businesses to make upgrades that make a difference. Among these are reduced prices on efficient light bulbs, low-cost water heaters, and heat pumps. For heat pumps, Efficiency Maine offers rebates of up to $1,600 per single-zone system for a total of $4,800 per business. Together with their zero-down loan packages, you may not have to pay a penny out of pocket to get a heat pump installed. As heat pumps are, on average, three times more efficient than any other heating or cooling system, the savings can be felt immediately. Even with added loan payments, installing heat pumps can save you money on a month-to-month basis. Talk to a professional before pulling the trigger as the savings will largely depend on your current system and fuel type, how well insulated your building is, and how you use the space. Additionally, if your business resides in certain regions, you can also participate in Efficiency Maine’s Business Initiative and receive 75% or more of a total LED light upgrade for your company. On a monthly basis, some businesses have reported upwards of $100 cost savings. If you’re on a shoestring budget, that can add up!
For more tips or to delve deeper into some of the topics discussed above, click on these links for Energy Star’s low- and no-cost energy tips, NREL’s Energy Savings page, and small business guide, or DSIRE USA’s state energy incentive tool.