Striking It Green in a Blue Economy

With the  stock markets down by almost a third since December of 2008, and credit  markets tighter than a new boot, lenders are raising the bar for  borrowers and turning away all but the best customers. In turn, the  credit squeeze will force businesses and consumers to take a hatchet to  spending. After more than a decade of red-hot economic growth fueled by  easy credit, business is facing an unprecedented cooling down for the  next two to five years that will dramatically change the demand for  consumer packaged goods.

The good news is that downturn or not, packaging is  always needed and greener packaging will be more important than ever.  Consumers and businesses will be buying less, but they will be expecting  more value from what they do buy. Retailers will be buying less too,  but they will also be wary about the high risks associated with low  costs. Brands and retailers will be likely to reduce the number of  suppliers that they buy from. They also are likely to make investments  that ensure the sustainability of the suppliers they consolidate to.

Increased  regulatory, investor, and consumer pressure for transparency,  accountability, and corporate responsibility will create new  opportunities for packaging and converting firms that can walk the talk  and quantify the impact of sustainability on the achievement of business  results. This "green" is evergreen

Before you  entertain the notion that green will turn to brown in the downturn,  consider the following: Walmart has announced a major partnership with  the Environmental Defense Fund at a global sustainability summit being  held in Beijing that will raise environmental performance standards  throughout its supply chain. WalMart's Green Supply Chain Initiative  will include targets for the reduction of energy and water use,  reductions in packaging (already in place with the scorecard), as well  as commitments to develop more sustainable products and more sustainable  supply chain practices.

The Walmart  Green Supply Chain Initiative is aimed at working with individual  suppliers on energy saving and other issues, and is expected to extend  to other US and European retailers, covering another 20,000 factories.  By 2012, WalMart will require suppliers to source 95% of their  production from factories that receive the highest ratings in audits of  environmental and social practices.

In addition  to the Walmart Green Supply Chain Initiative, major brands and retailers  will employ marketing automation systems to coordinate marketing, sales  and promotion efforts across different media (including packaging,  coupons and point of purchase promotion) to maximize the effectiveness  of their advertising and marketing spend. They will also be employing  product lifecycle and supply chain management systems that will help  them address systemic risks associated with unsustainable packaging and  supply chains.

If you think  that sustainability is a passing fad and that green initiatives will  fall by the wayside during the downturn, think again. If you take steps  to make sustainability a key aspect of your day-to-day business  practices, your company is less likely to be frozen out of the intense  competition for business and credit that will prevail