Small Business

Creating Eco-Friendly Operations


Entrepreneurs are turning their companies green, using a range of approaches from investing in alternative energy to banning plastic forks in the pantry

Entrepreneurs, already at the forefront of the environmental revolution with the products they sell, also are proving to be leaders of a less visible but equally powerful trend: the transformation of their companies into lean, green operations. Some say concern for the environment is their inspiration to go green; others are looking to cut costs or trim waste. Regardless of motivation, there are "countless thousands of small businesses out there greening," says Byron Kennard, founder and executive director of the Washington (D.C.)-based nonprofit Center for Small Business & the Environment. "It's a technological and cultural revolution." According to an April survey by the National Small Business Assn., 38% of small companies surveyed have invested in energy efficiency programs in the past 18 months. Some 13% had invested in alternative energy sources, 6% had purchased or leased hybrid or alternative fuel vehicles in the past 18 months, and 18% had given employees incentives to cut back on driving.

Together, these changes have the potential to make a sizable impact. Small companies account for half the country's industrial and commercial energy use, according to Energy & Security Group, a consulting firm based in Reston, Va. Because energy-efficient improvements typically reduce consumption by 30%, entrepreneurs have the potential to reduce their collective CO2 emissions by 182.2 million tons annually—the equivalent of 36 coal-fired power plants—and to lop $30 billion off the nation's energy bill.

Such gains don't come easily. It takes a lot of work—and sometimes outside consultants—to figure out how best to reduce the environmental impact of a business. And while some green initiatives save money, tight credit markets can make it difficult to finance green investments. Some 52% of companies surveyed by the NSBA cited weak cash flow as the main obstacle to making improvements in energy efficiency.

In this slide show we highlight six entrepreneurs who have made great strides in transforming their companies into more eco-friendly enterprises, whether it's by installing a major solar electric system or by finding new uses for sawdust and leather scraps. All would tell you that going green has been good to them.

Not sure how to get started on your green makeover? Here are a few resources: 1. dsireusa.org A comprehensive listing of incentives for energy efficiency and renewable energy. A click on your state calls up information on all state, local, federal, and utility programs, including rebates and tax breaks. 2. energystar.gov/smallbiz A wealth of information on how to save energy. Includes a small business guide on everything from lighting to recycling. A nifty tool shows how you rank compared with similar firms. 3. greendrinks.org Listing of regular green networking meetings worldwide, including a breakdown by state in the U.S. The informal meetups are great to get ideas. 4. epa.gov/waste Search by state to find information, resources, and tips on recycling anything from industrial waste to computers.

To see all the elements of the special report, visit the related items box at upper right side of this story.

Return to the BWSmallBiz August/September 2009 Table of Contents

Barrett is a senior correspondent for BusinessWeek SmallBiz.

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