How Retailers Can Respond to an Increased Call for Sustainability

retailers and sustainability

According to Deloitte’s 2023 CxO Sustainability Report, 73% of retail Chief Experience Officers (CxOs) have increased their investment in sustainability. This shift is driven by growing pressure from customers, board members, and regulators. The benefits of this sustainability movement are clear: enhanced brand recognition, improved customer satisfaction, and more efficient, resilient supply chains.

A shift in consumer values is no longer a passing trend but a permanent perspective. Modern consumers are increasingly focused on how their purchases impact:

  • The environment: They evaluate retailers’ practices around manufacturing, packaging, and operations that contribute to climate change.
  • Social responsibility: They assess labor practices, including fair wages, safe workplaces, and ethical sourcing.

As a result, retailers are prioritizing the use of sustainable materials, ensuring ethical labor practices, and reducing their environmental footprint. However, achieving these goals poses significant challenges, particularly in managing, tracking, and reporting sustainability efforts. Technology plays a pivotal role in enabling brands to meet the expectations of today’s consumers and regulators.

The First Challenge: Gathering and Consolidating Data

Compliance is a critical component of sustainability. Retailers must navigate complex regulations from the U.S., California, the EU, and beyond. Key data points—from child labor practices to plastic versus recyclable packaging usage—must be gathered and analyzed.

Some of this data resides in SAP systems, but when factories and suppliers operate outside of SAP, retailers must rely on questionnaires to collect the required information. The challenge then becomes integrating this external data with internal systems for meaningful insights.

Carbon Footprint Complexity: Calculating a carbon footprint involves understanding factors like how many employees fly to meetings versus using online technologies. For large enterprises, determining the necessary data and where it’s located can feel overwhelming.

Modern Data Infrastructures: A Solution

To address these challenges, modern data infrastructures—like data lakes and analytics services—offer the scalability and flexibility needed to consolidate and analyze sustainability-related data across the supply chain.

The Role of Cloud Migration: Retailers can leverage Cloud-based solutions to create hybrid systems that support comprehensive tracking and reporting. For instance:

  • Centralized Dashboards: By integrating all data into a centralized dashboard, retailers eliminate the need for multiple tools. This reduces training time, minimizes errors, and streamlines processes.
  • Automation and Real-Time Insights: Automated reporting tools provide real-time or near real-time data access. Issues can be identified and addressed quickly, preventing small problems from escalating.

These modern systems also simplify compliance reporting, allowing retailers to meet regulatory requirements efficiently while building consumer trust through transparency.

From Data to Action

Every retailer knows the importance of tracking and reporting on sustainability efforts. The process involves three critical steps:

  1. Identify the necessary data: Determine which sustainability metrics to track, such as waste generation or carbon footprint.
  2. Consolidate data sources: Integrate information from internal SAP systems and external partners.
  3. Analyze and act: Use centralized repositories to pinpoint problem areas, identify actionable steps, and monitor progress.

Real-World Impact

Lemongrass has partnered with leading retailers to overcome these challenges. For example, we’ve helped clients:

  • Establish hybrid systems for tracking vendor compliance with labor and ethical sourcing requirements.
  • Reduce packaging waste through better data visibility.
  • Lower their carbon footprint by optimizing supply chain logistics.

By building customized technology infrastructures, our clients have gained the tools needed to consolidate data, analyze it effectively, and act swiftly to meet sustainability goals.

Imagine a dashboard displaying key performance indicators like carbon emissions, waste percentages, and ethical sourcing compliance—all updated in real time. These insights empower decision-makers to act with confidence, ensuring their brand’s sustainability efforts resonate with today’s socially conscious consumers.

Partnering for Sustainability Success

At Lemongrass, we specialize in helping retailers navigate the complexities of sustainability. From identifying the right data to designing Cloud-based systems, we enable our clients to:

  • Reduce waste and environmental impact
  • Ensure ethical practices across their supply chain
  • Build trust with consumers through transparent reporting

If you’re ready to transform your sustainability efforts, contact us today to explore how our expertise in SAP and retail technology can help you meet your goals.

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