By Michael F. Carmichael
Nov. 19, 2009
Bentonville, Ark.-based Sam’s Club is the $40-billion-plus wholesale division of Wal-Mart. Like Wal-Mart, it has embarked on a corporate-wide program to promote sustainability - both internally and in the products it sells to its members.
Catherine Corley is the Club’s vice president of Small Business and Consumer Strategy, and its leading advocate for all things green.
“Our goal,” Corley says, “is to reduce our corporate waste to zero and be socially responsible.” Asked to explain if there are any differences in Sam’s approach to ‘green’ and the parent company, Corley explains, “Sustainability standards apply to both Wal-Mart and Sam’s Club, but we do have a niche of our own. We have features and things in our Clubs that just we do. Wal-Mart may be a little bit faster in some things.” In July 2009, for instance, Wal-Mart - the world’s leading retailer - announced that it was creating a ‘sustainable product index’ the goal of which is to let its millions of customers know that “the materials in the product are safe, that the product is made well, and that the product was produced in a responsible way.”
Sam’s Club has created Simple Steps to Saving Green, with an easy-to-identify product label. “The primary thing we’re trying to do is help our members who want to go green, whether that’s in their home or their business,” says Corley. “It’s an eco-icon that helps identify products within a Club that are in some way more sustainable. We’ve got a lot of criteria, we work with a lot of outside certification organizations that help evaluate those products. Our suppliers have to submit them and they go to the independent counsel to receive that certification. If they get it, they’re able to put that logo on their packaging and then we present that in the Club.”
Corley explains that the Clubs have put many of the sustainability products together in a Home Efficiency Aisle. “You can walk down it and see item after item with the Simple Steps to Saving Green icon. That’s a great way to see that presence and when people are in that aisle it’s very visible to them that they’re making good choices.”
By September 2009 Wal-Mart and Sam’s Club had sold more than 260 million compact fluorescent light bulbs, saving customers more than $7 billion in energy costs, according to company estimates. It’s no wonder, then, that Corley says, “In the Home Efficiency Aisle we have a lot of lighting - the squiggly bulbs and solar panels.”
Lighting, however, is not the only ‘green’ item in the Clubs that’s selling. Corley explains, “Another thing that’s been popular has been a dual-flush toilet. In one Club we had a contractor come in and I think he bought our whole allotment of that. As a lot of people want to go green and remodel their homes that received a lot of interest.”
Corley and her staff also try to save their members money, she says, by working “with local power companies and water utilities on rebate offers, particularly on the low-flow dual-flush toilet.”
The idea of rebates and other money-saving approaches is high on members’ minds, Corley explains, but that’s not the only reason, “There’s such a high interest in sustainable products, especially where it saves you money. That’s where we’ve found the sweet spot is - when you can do something that takes us toward a better environment, it also saves you money, then it really is a sweet spot.”
Corley recalls a recent meeting with Working Mother magazine. “They were talking about issues and terms that are most searched by their readership and green or sustainability was the number one term that came up, so there’s a high degree of interest.”
Corley might be termed a ‘green’ evangelist. “I go out and work with small businesses all the time, particularly women-owned small businesses, and they’re very, very interested in how they can go green. Another example of a product, that’s not exactly green, but ends up with a green outcome, is document scanners for small businesses or home offices that want to go paperless. That’s another item in the Club to help them.”
Because of Wal-Mart’s immense influence in the retail world, Corley explains, “I think Wal-Mart has caused a lot of suppliers to get on board with this initiative. Before I came to Sam’s Club I was with Tyson Foods, a manufacturer, and we always thought ‘sustainability’s good, but our customers weren’t demanding it.’ When a customer demands it, that’s when you act. And Wal-Mart, by taking a lead in that, really helped make that happen for the manufacturer community.”
Much of the interest in creating sustainable products has been driven by the lower cost-points required, particularly in a recessionary economy. Wal-Mart’s actions created the tipping point.
“What needed to happen in order for the cost of sustainable products to come down was a large entity that’s going to buy that product to make it scalable and worth the investment to bring those costs down,” Corley explains. “A lot of our top manufacturers have their own sustainability reports now so they’ve really jumped on the bandwagon. Maybe begrudgingly at first, but they’ve embraced it now. A good example would be concentrated [liquid laundry] detergent that takes up less shelf space, saves on packaging and is less expensive to ship.”
How does Sam’s Club get the word out about the benefits of a greener lifestyle? “We have our own publication that goes to our members and we have at least one and sometimes two issues dedicated to going green and talking about it, sharing information and education, highlighting some of the items that help them go green,” Corley responds.
Parent company Wal-Mart is experimenting with what they call “high efficiency” stores, and Meijer is remodeling or building new stores that will be LEED certified. What is Sam’s Club doing internally, Corley is asked.
“Because Wal-Mart and Sam’s Club made the commitment to retrofit our freezers, we’ve been able to bring the cost of LED lighting down. It’s better efficiency and it’s a better experience for our members because the lighting is really much better than our traditional lighting - and our utility costs go down, so that’s something we’re on board with,” she explains.
Getting a vast amount of products to the Clubs is also a challenge. Corley continues, “We’re also very on board with logistics efficiencies and driving less miles and looking at less packaging. Take a gallon of milk, for instance. We’ve totally changed that to be this kind of funky, cube-like milk container that has allowed us to get more product onto a truck so that we can increase those efficiencies and that’s been a huge improvement. So we actually led on that one.”
One way in which Sam’s Club and its parent cooperate are sustainability networks. Corley explains further, “Many of our Sam’s Clubs are part of those networks. As an example, we have a jewelry network and we have Sam’s Club members on it and Wal-Mart members on it and we have NGOs, outside certification organizations.
One way in which Sam’s Club and its parent cooperate are sustainability networks. Corley explains further, “Many of our Sam’s Clubs are part of those networks. As an example, we have a jewelry network and we have Sam’s Club members on it and Wal-Mart members on it and we have NGOs, outside certification organizations. One of the results of this was a line of jewelry called Love, Earth. It’s made 100 percent from sustainable mines. When you purchase a Love, Earth piece of jewelry - earrings or necklace - you get a certificate that shows the mine that it came from and you can go online and trace it all the way back.”
Corley explains, “We really pioneered the idea because it was not a transparent industry. It was two women buyers who took it on themselves and then worked with outside organizations to help them and they were able to get that done and they really transformed the [jewelry] industry. It’s a pretty amazing story.”
Sustainable thinking is becoming part of the corporate culture at Sam’s Club. “It’s part of everyone’s goals,” says Corley. “Sustainability is part of our performance goals, it’s part of our business planning, so it’s a very deliberate and conscious effort in everything we do.
One of those conscious efforts is called a Personal Sustainability Program (PSP) that’s voluntary. Corley continues, “We have PSP captains. The PSP captains are trained and they help other people set their own sustainability goals and monitor and keep track of them. We have people that are losing weight, we have people that have stopped smoking, we have people that are taking actions in their home recycling or doing other things that they can do to improve the environment or improve their own health.”
Students In Free Enterprise is an organization of students in college who compete in the Sam’s Club Environmental Sustainability Challenge to do business projects. “This year’s contest for the SIFE students is to compete on ‘greening your business,'” Corley explains. “Last year the winners worked with a restaurant to give them ideas on how to make their business more sustainable. Certainly restaurants are under a lot of pressure with cap and trade and everything else so they have a long way to go to get green and they have a high desire to get green. The contest is a way for us to foster and embed the importance of that with these students, but also a way to help our small business members by letting the students work on their businesses. That allows us, too, to publish those best practices on our Web site so that other small businesses can learn from them,” Corley concludes.
“We worked with another small business that just opened,” Corley says, “a LEED-certified green health club. Someone on my team worked with them to help them make good choices, like TVs that actually use less energy, that’ll help lower their costs for them. They were sourcing much higher cost products for their new fitness club and we were able to help them achieve their goals and help lower their costs as well.”
The idea of promoting best practices to their members is high on Sam’s Club’s to-do list. “Others are inspired by what others are doing,” Corley explains, “I’ve done some focus groups with women business owners, for instance. We’d split them up into three tables - ‘who just wants to be green, who is green, and who’s super-green, committed, feels like you’re all the way to bright’ - and they all learned so much from each other, it’s really helpful.
“We’re dedicated to sustainability, our CEO is dedicated to it. It’s the right thing to do,” Corley says.