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Green Supply Chain Expert Insight
By Dan Gilmore
Oct. 13, 2009
 

Green Supply Chain Comment: Will Walmart Green Product Labeling Create New Scarlet Letter?

 

Consumers will Generally Buy the Cheapest Product, but will Peer Pressure at Check-Out Force Green Habits?

I am not completely sure yet what is going on with Walmart’s “Sustainability Index” for suppliers and products, but it makes for some interesting possibilities.

Two decades ago, for those old enough to remember, Walmart famously led a “Buy American” charge, spending millions on television ads that often featured Sam Walton himself.

Didn’t work – Walmart soon found that consumers, in general, wanted low prices more than they wanted to buy American. The campaign soon ended, and now Walmart is the world’s largest importer of goods from China.

More recently, Walmart, Home Depot and other retailers have started to have some of the products on their shelves marked as being “Green.” My sense is this has not had much of an impact on consumer behavior. Why? In part, because so few products yet have the label.

More recently, however, Walmart has announced plans for a new Sustainability Index, which will be created, in part, based on a consortium of various academics, consultants, suppliers and others offering advice.

According to the Walmart web site: “The final step of the index is to provide customers with product information in a simple, convenient, easy to understand manner so they can make choices and consume in a more sustainable way. This will provide customers with greater transparency into the quality and history of products than they have today. How that information is delivered to consumers is still undetermined.”

Read between the lines – this means there is likely to be a Green score for each product (though there are huge challenges in doing this accurately and fairly) sold at Walmart.

Will this be a small label that can only be read if a consumer gets very close to the product? Or will it be a prominent score, easily seen on most products from a distance? The new “Scarlet Letter?”

Just imagine if it is the latter – you go to buy a toaster, and there, the cheap one, has a giant “47” emblazoned in bright green on the side (out of 100). The more expensive one has a sterling 84 rating.

What do you do now? Will your fellow shoppers see that you have opted for the pollution and C02 generating machine? Even worse, what if someone you know sees your callous disregard for the environment? Can you cover it up with bread and milk? Will the cashier scoff at you when you move through checkout? There is always the self-scan area…

I remember in the movie “Serial Mom” when Kathleen Turner destroys the credibility of one witness when she accuses her of failing to recycle. The jury and crowd in the court room gasp in amazement and disgust, and her testimony against Turner’s character becomes worthless.

I am doing this in a bit of a humorous way, but for consumer goods manufacturers, this is deadly serious. I, for one, am not wild that Walmart could throw its market clout around this strongly and, in fairness, there are a lot of unknowns in how this will play out. To maintain this accurately at a product level would be a daunting task.

Still, it seems clear that such labeling is coming. The only question is whether only the consumer will know – or every other shopper in the store as well, and maybe your neighbors.

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ABOUT THE AUTHOR
 
Dan Gilmore is Editor of Supply Chain Digest and The Green Supply Chain.com
 
Gilmore Says:

This means there is likely to be a Green score for each product (though there are huge challenges in doing this accurately and fairly) sold at Walmart.

 
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