Contributed by Patrick Maley

The urgency to “go green” has permeated the retail industry on everything from energy to packaging – and even carbon emissions.

Lowe’s, the home-improvement store, purchased “green power,” electricity produced from renewable sources, such as solar and wind turbines.  Sears reduced the use of vinyl in the packaging of items sold in its stores.  And European mega-retailer Tesco, which recently made its first foray into the U.S., is working on carbon labeling that records the amount of carbon dioxide emitted during the production, transport and consumption of its 70,000 products. 

Quite a few retailers are jumping on the green bandwagon.

Yet many have failed to realize the untapped market for driving sales and reducing carbon footprints.  To date, their focus rests on energy conservation and recycling inside the store, but the industry’s elusive Holy Green Grail today remains outside the store – in shipping.

What if retailers could offer green shipping choices that eliminate dozens or even hundreds of pounds of carbon emissions?  In the world of just-in-time delivery, the idea of offering green shipping options to shoppers may seem anathema to a retailer’s traditional view of customer service. 

But in today’s Inconvenient Truth world, imagine the impact on the eco-friendly online shopper who gets the following message:

“Your order is scheduled to arrive on Tuesday. However, if you want to reduce greenhouse gas emissions by 100 pounds of CO2, click here and your package will arrive on Thursday instead.”

Many buyers would select such an option in a heartbeat. The first retailer that figures this out will garner tremendous customer loyalty from green-focused shoppers. As energy prices spiral out of control, the approach also will provide a way for retailers to save on fuel costs and significantly impact the bottom line.

Most customers and businesses already have some flexibility when it comes to receiving shipments, such as “First Thing in the Morning”, 10 a.m., and 2nd-day delivery options.  Still, there are several industry trends that reflect a rapidly growing awareness of the need to minimize the environmental impact of shipping even more. 

For instance, one of the biggest challenges facing retailers is getting the most out of their truckloads.  An industry-wide goal has been to minimize or eliminate unutilized space within shipping containers. 

The norm today is for trucks to hit the road with 50 percent or more capacity to meet projected delivery timeframes.  In some cases, half-full trucks are sent out because of delivery demands.  But many times, those factors don’t come into play in the customer’s mind.  Many shoppers would consider alternatives that extend delivery options by as little as several hours if presented with the cost benefits of doing so. 

In addition, vehicle idling time is an area in which retailers can save money and reduce their carbon footprints. Government regulations that aim to reduce engine idle time during the pickup and delivery process are all the rage across the country.  Our research has found that companies implementing some form of anti-idling technology can reduce idling time by up to 30 percent. 

Another hidden cost comes from inefficient route planning that result in trucks sitting in traffic with profits leaking right out of the gas tank.  Routes designed to avoid left turns can greatly reduce idling and, thus, fuel costs.  Also, right turns at intersections are faster than left ones due to “right on red” laws and the fact that drivers only have to turn into one lane of traffic. 

In fact, studies show that truck deliveries are the most expensive form of transportation and distribution, and that cost is only going to go up as the price of fuel skyrockets. If retailers consider alternative modes of transportation and distribution, such as rail or ocean, earlier in the supply chain, then they will substantially reduce their environmental impact.

Fedex, UPS, Amazon and others have proven that customers are willing to examine cost tradeoffs for delivery.  The visionary retailer offering green tradeoffs for flexible delivery times will grow sales, reap vast amounts of brand capital, and endear itself to green shoppers around the world.

Patrick Maley is Vice President, Corporate Marketing at RedPrairie (www.redprairie.com), which makes store operations and supply chain software for 12 of the top 20 retailers in the U.S.