We live in a world that is witnessing the most significant growth in technology and the availability of everything at our disposal. At the intersection of this supremely abundant world is the threat to the environment lead by new inventions in technology.
SMEs in Singapore witness the best time, where the government provides enormous assistance in the form of loans and grants. In today’s economy, enterprise that contributes to the society by use of eco-friendly products and by-products create empire having sustainable growth on a long term basis.
The earth is what we all have in common,.
said Wendell Berry, American novelist and environmental activist.
We have forgotten how to be good guests, how to walk lightly on the earth as its other creatures do.
said Barbara Ward, British economist and writer
With the growing threat to the environment posed by humanity at large and the multitude of benefits that SMEs have in their journey, they have considerable advantage when they become an eco-friendly SME.
Enterprises that consistently follow a path of encouraging environmental and green business practices showcasing growth prospects. SMEs that:
- Voluntarily adopt the path of walking lightly on the earth, and
- Co-create it to be a more eco-friendly space,
Have huge advantages such as:
- Setting an example for everyone in the industry,
- Create a more sustainable future for themselves, and
- With green business practices develops high trust with more discerning and environmentally conscious customer.
What would happen if there is no eco-friendly SME?
Going green is not an optional factor anymore; it is the connection with having and keeping the customers that are going to be the future millionaires and billionaires.
A Nielsen study reported 66% of global consumers resonate more with sustainable and environmentally friendly products.
Another study by Nielsen revealed that despite the most challenging environmental conditions presented to millennials (Gen Y) in the past 100 years, almost three out of four respondents of the study were willing to pay extra for sustainable offerings.
If that was not enough, 72% of Gen Z respondents (in the age group of 15-20 years) are also willing to pay more for products and services given by companies that are committed to positive social and environmental impact.
If an SME does not decide to go eco-friendly and continues to operate on traditional methods in which business used to run, it is going to face serious repercussions, such as:
- Higher costs of materials: If a company is not paying serious attention to the rapid ill effects they are having on the environment, they are creating a higher operating cost for themselves. However, using eco-friendly material in offices, having green business practices may be more expensive in the short-run but save money in the long-run.
- Lack of trust (and consequently revenue) from customers: Internet has collapsed the information from the entire universe onto a small device. The customer that the SME seeks to serve is well-informed of the disadvantages of not using eco-friendly practices. To further add to it, the customer is also aware of steps taken by competitors to create an eco-friendly business. Hence, customer loyalties will shift in the competitor’s favor.
- Unsustainable business: The sustainability journey, comprising of five stages of sustainability that every enterprise goes through:
- Beyond compliance
- Integrated strategy
This is the framework for the evolvement of business from unsustainable one to a sustainable one, is a catalyst for strategic growth of the enterprise. If the company is part of the journey that does not comply with sustainable practices, it is destined to be unsustainable, which, in turn, is not suitable for the overall growth of the enterprise.
Since SMEs employ over half of Singaporean workforce, the government also has the upper hand in providing grants for growth of sustainable SMEs, among which include:
- Capability Development Grant (CDG): Eligible for any SME incorporated and operating in Singapore, the government provides grants up to $30,000. It assists startups for building capabilities in several business areas that include costs of equipment and cost of certification. It is a suitable grant for an SME focused on using eco-friendly machinery and equipment that reduce pollution or reduce carbon emissions into the environment.
- ComCare Enterprise Fund (CEF): SMEs that hire and train Singaporeans, the government offers CEF grant up to 80% of capital costs and $300,000 of the operating expenses for the first two years. This grant provides funding to social enterprise startups.
Several enterprises do create eco-friendly products and services that change the traditional dimension of businesses.
For example, Cloversoft is an affordable brand of hygiene and bathroom tissues that uses bamboo instead of paper. The most significant advantage of bamboo is it absorbs 35% more carbon than trees and cultivate without insecticides and pesticides.
Another useful example is Eco.Le, which is a small zero-waste grocery store in Singapore, offers bulk foods and lifestyle products to help reduce packaging and waste. The store also adopts “Bring Your Own” bag concept that reduced usage of plastic bags.
As we discovered from the above examples, every small step towards creating an eco-friendly SME is a huge step towards an eco-friendly environment.
If done well, being green is a genuine opportunity to increase sales, especially with millennials, who arguably are more sensitive to most green issues.
says Mr. Tarun Deo, Managing Director for Singapore and South East Asia at Golin
RedMart, an online grocery service, has gone one step ahead; the eco-friendly products are more affordable than better-known brands. For example, Redmart’s Forest Stewardship Council (FSC) certified 3-ply toilet paper cost cheaper (S$5.20) than regular branded toilet paper (S$6.95), for the same quantity.
We believe being environmentally friendly should not come at an extra cost.
said RedMart’s head of non-foods Emma Paterson
Given the significant impact to the bottom line of the company and the ecological aftermath of not going eco-friendly, they must make the shift. For SMEs to survive in the long term and keep their current and future customers loyal, companies must adopt eco-friendly ways of being in business and consistently scaling them up.