Imagine that you’re currently researching and considering buying a new kettle. After two weeks of searching, you have finally narrowed it down to the two best products with the same price tag. However, one of them uses much less electricity and has many safety features. Which one would you choose?
For many people, it seems like an obvious question. Most definitely, you would go with the kettle that uses less electricity so you can save money and preserve the environment. However, many business owners might take a different approach. They might think the sustainable version can not perform as well as the traditional version. Especially it can be a significant factor when making a considerable investment. Fortunately, from various research, we know that the return on investment is not much different. In fact, it poses fewer risks and gives many benefits, such as less impact on the environment and other issues.
So whether you offer management consulting services and work with a client who wants to invest in green technology or you are a business owner who wants to become more sustainable, investing in green technology shouldn’t be one of your concerns. This article will cover our favourite reasons why you should do it.
Attract Potential Investors
We are all aware of the climate change we are currently facing. Many organisations and governments are trying to do everything they can to preserve our environment. More importantly, investors are also becoming interested in this topic.
Some of the most significant investment companies forecast that green investing will become the future. Not only it creates new business opportunities for sustainable companies, but it also improves the perception of your company. The majority of customers prefer sustainable companies. So not only do you have a high chance of getting an injection of cash, but also, this investment will allow you to create more sustainable products and services that your consumers will love.
When you invest in green technology, most often, your company becomes more resource efficient. Paying less for water, waste, and electricity will allow you to save on fixed costs and use that additional cash towards growing your business. It’s a win-win situation both for you and the environment.
If you follow social media and listen to your customers, you are most definitely aware of sustainability’s importance to them. Research shows that the two biggest customer groups, Millennials and Gen Z, favour sustainable brands. In fact, they are often keen on spending more money on a more expensive product if it’s sustainable. For example, around 70% of Dutch and Swedish consumers say that majority of their purchase decisions are influenced by sustainability.
Lower Potential Risks
Anyone who is a business owner is aware of many potential risks. However, green investing and transparency can mitigate many of those. If you often analyse both internal and external business environments, you will likely identify potential threats that can be mitigated or used to your advantage. A proactive risk management strategy and a good understanding of the value chain create a valuable opportunity to use when problems occur.
When operating in any industry, from retail or manufacturing to financial services, the risk is a part of it. Perhaps the factory you are sourcing your products from is facing some problems associated with not being sustainable. In that scenario, not only are you risking your products not meeting your expectations, but more importantly, the customers are likely to notice that. If that occurs, they will boycott your company, as has often happened with fashion retailers. That’s why investing in green technology and sustainability can give you an opportunity to mitigate possible risks.
As you can see, investing in green technology is not as complicated and scary as it might seem. It will give you many opportunities to grow your business, such as better customer loyalty and risk mitigation. Moreover, the investing world also realises this change, and they are likely to capitalise on it, which makes it a perfect time to make the green switch.