Businesses are more aware of the bonuses associated with green procurement than ever before, given the vast number of benefits that it can bring. Essentially, green procurement ensures that businesses protect local environments and economies from the effects of their operations, all the while allowing a business to deliver goods, services

Now, it seems that there are plenty of financial incentives to encourage manufacturers to design environmentally-friendly items, whether it’s to avoid taxes and additional costs levied against those uninterested in resource conservation, or the extra outgoings paid through utility bills because of inefficient use of energy and water.

Sourcing locally can certainly boost sales. Flyerzone, an eco-friendly supplier, works particularly hard to forge relationships with nearby clients to boost their productivity, environmental credentials and save themselves money along the way. Many other organisations are very happy to broker regional deals to save money, even if local sourcing demands is becoming a bigger public desire.

Supermarkets in particular are angling themselves towards these programs. Waitrose, Asda and Tesco are particularly proud of highlighting times when they have sourced directly from a farmer in the region, while online stores such as Farmison.com solely market around these individuals and even give you specific insights into the companies and families that sustain their sales.

Procurement policies are also beginning to heavily centre on waste regulations, for money-saving reasons as much as ethical ones. The Packaging Directive tries to minimise extraneous materials and goes on to promote energy recovery as well as the re-use of packaging; it has effectively led to EU member states introducing national policies to set a minimum level of recycling, which is steadily increasing as recovery technologies improveThe UN advocates sustainable development of products made from popular materials such as woods and metals, and the United Nations Environment Program has proposed incentives for companies to replant and recycle to limit potentially devastating deforestation and water pollution. This is limiting international companies from visiting foreign nations such as Brazil and harvesting their wares, avoiding local and national regulations through importing. When businesses demand local produce, it is becoming clearer that this approach simply isn’t acceptable.

By adopting environmentally and locally-friendly initiatives, procurement managers can reduce overall production costs, create new standards and keep a solid supply chain in their area and beyond – all the while adhering to compliance regulations..

This post is a guest blog post from our supporters.

Article Contributed by IBISWorld Analyst Eben Jose

It hasn’t been the best of times for small businesses lately, but with the national unemployment rate finally decreasing and disposable income increasing, consumers are hitting Main Street once again for some retail therapy. Often facing overwhelming competition from retail megastores, many small businesses face an uphill battle from the outset and often don’t survive beyond a couple years. Some industries, however, offer better prospects for entrepreneurial endeavors. Based on IBISWorld research, the following are the top five small-business retail sectors based on start-up costs, barriers to entry and estimated revenue growth in 2012.

Retail Sector - Estimated 2012 Revenue Growth (%)
Tire Dealers 10.0%
Handbag, Luggage and Accessory Stores 5.5%
Art Dealers 4.0%
Furniture Stores 3.4%
Specialty Food Stores 2.3%

Tire Dealers
Opening a tire dealership probably isn’t on the top of anyone’s to-do list for 2012, but based on numbers alone, it’s one of the most promising small-business retail sectors to start a business. Changes in consumer preferences toward more fuel-efficient tires and pent-up replacement tire demand from people who postponed purchased during the recession are expected to fuel industry profit in 2012. IBISWorld expects revenue to grow at an average rate of 3.1% per year in the five years to 2016, and 10.0% in 2012 alone.

Handbag, Luggage and Accessory Stores
With the recession in the rear-view mirror, people are slowly loosening their purse strings on more discretionary purchases, including of purses nonetheless. Aside from small hiccups during the recession, handbag, luggage and accessory stores have fared rather well. The dips in consumer confidence and disposable didn’t significantly discourage shoppers, and now that both of these factors are on the rise, sales are also forecast to increase. With revenue expected to grow at an average annual rate of 5.1% through 2016, this retail sector offers appealing opportunities for start-ups.

Art Dealers
It’s unlikely that consumers will come across an original Picasso at their local art dealer, but that won’t stop them from looking in 2012. Similar to most luxury goods retailers, art dealers experienced a surge in demand while the economy was booming, with wealthy consumers splurging on original art. Although that demand slowed during the recession, it is expected to return as fine art’s investment and aesthetic appeal increases. Requiring only the ability to source and value artwork, the low levels of labor and capital needed to get started in this sector make it an appealing one for start-ups. IBISWorld estimates revenue for art dealers to grow 4.0% in 2012 and at an average annual rate of 4.3% through 2016.

Furniture Stores
Although some furniture can be viewed as nondiscretionary, demand for furniture generally follows trends in consumer sentiment and income levels. Prior to this year, furniture stores experienced a harsh drop in demand as confidence in the economy fell and Americans reduced their spending. But with homeownership and per capita disposable income expected to increase in 2012, consumers will stop flipping over the couch cushions and finally upgrade their furniture. As such, 2012 offers great opportunities for furniture store entrepreneurs, especially with revenue projected to increase 3.4% in 2012 and at an average annual rate of 3.0% through 2016.

Specialty Food Stores
The foodie population is expanding fast. While supermarkets continue to serve the majority of this customer base, there is a growing number of consumers who want a finer, and sometimes even more exotic, eating experience. There’s no doubt that spending on high-end food took a hit during the recession as Americans tightened their wallets and became more price conscious. But with disposable income increasing, people are once again seeking out their favorite foods. With low initial start-up costs and revenue expected to increase 2.3% in 2012, specialty food storeowners can expect business to heat up in the coming years.

About the Author

Eben Jose is an analyst with IBISWorld, the world’s largest independent publisher of U.S. industry research. IBISWorld’s team of expert analysts covers 700 different market segments.