Governments and businesses across the world are facing the threat of climate change. In aspiring towards a new, greener world, many are wondering exactly how does being environmentally friendly help businesses?
Navigating this topic is complex and will vary by industry. Read on to find out ways in which being more eco-friendly can help or harm your business below.
Whether you’re starting out as a sole trader or limited company, environmental issues may come to affect your business. Get ahead of the curve and learn how going green can help your business below.
How being environmentally friendly can help your business
As a selling point for your business
As consumers become aware of the various ways in which businesses have contributed to the current circumstances, being an environmentally friendly business can be a selling point to attract customers.
Many people are keen to see entrepreneurs provide the products and services they need and want without the former harm it took to deliver them. Whether your packaging or materials are vegan-society approved, sustainably sourced, fair trade or carbon negative, there are so many ways in which businesses can add additional value to their goods and services.
This selling point is particularly relevant for younger consumers who are more in touch with the ins and outs of what makes a business green or not. Therefore, if you cater to younger or more eco-aware customers, you may wish to transition your business to a more environmentally-friendly model. Similarly, many lending and investment firms are also on the lookout for lucrative green business opportunities as they transition to more eco-friendly support strategies.
As a fast track for patents and government support
Similar to the above point on investment, many branches of government across the UK are interested in supporting green business methods and models as they enter the market.
In particular is the Intellectual Property Office (IPO), which has offered a ‘Green Channel’ for patent applications since 2009 that makes the process faster. Therefore, if you can demonstrate an environmentally beneficial aspect of your product, you can be granted an exclusive patent for the UK market faster from the IPO. If you’d like more information on patents, read our article How to patent a business idea.
Similar opportunities for contracts and grants are available with government offices across the UK. Whether it’s in receiving tax relief from reducing your business’ carbon emissions or working with local council authorities to improve energy efficiency in homes, your business stands to benefit from delivering environmentally friendly goods and services.
As a way of avoiding carbon taxes
Levies and taxes on various products are constantly being discussed by climate change policymakers. The key idea is to put pressure on businesses and customers to choose greener products.
Therefore, even if they don’t affect your business currently, your business can benefit in two key ways by becoming more environmentally friendly: avoiding any future taxes in your supply chain and (in turn) keeping your customer pricing low to stay competitive.
How being environmentally friendly can harm your business
As a limiting factor on your growth
Even with tax relief, business grants and various other forms of business support, environmentally-friendly practices are seen by some as a commercially limiting factor.
This view isn’t applicable to every business, and any limiting effect may be felt differently across various industries where it is true for some businesses more than others. This is because some industries are predicted to keep on using high levels of carbon emissions for various reasons even as the world re-models to be more green elsewhere.
For example, certain medical products like needles or bandaging rely on plastic packaging because it can be made sterile more easily and will almost certainly continue for this reason. However, transport or clothing goods are predicted to transition to greener versions almost entirely. Therefore, it may be possible you feel a limiting effect of green business practices directly or indirectly in the form of a tax on you or one of your suppliers in your supply chain.
Not actually being environmentally friendly
As suggested above, consumers (especially younger ones) are more likely to spot businesses pretending to be green. This is a marketing tactic known as ‘greenwashing’. Unfortunately, many product launches and marketing campaigns have faced ridicule and anger from customers, frustrated at the business’ half-hearted attempt to be environmentally friendly.
Therefore, if you’re going to be green, make sure you do it properly. Every day, new eco-friendly businesses enter the market and are available to help businesses make their materials or service products better for the environment.
Save time to build a greener business with Countingup
If you’re looking to gain back time to focus on creating an environmentally friendly business, Countingup can help.
The two-in-one financial app can save you time to research green strategies for your business, and offers a seamlessly digital and paperless accounting solution ready for a more sustainable future.
Countingup is the business current account with free, built-in accounting software. It comes with key business functionality like automated invoicing tools and expense reminders and input system – all handled on your phone, meaning less paper and faster accounting.
The simple app comes with real-time profit and loss reports, tax estimates, and is compatible with Making Tax Digital (MTD), which the majority of small businesses will need to comply with by April 2023.
Find out more about how Countingup can help you save time everyday here and sign up for free today.