How Green Building Can Enhance Retail Performance

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Wednesday, February 3rd, 2016
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While sustainability advocates have long touted the benefits of green buildings when it comes to efficiency and environmental impacts, they can also have a positive influence on the bottom line of commercial businesses.

In addition to cutting down on operating costs and utilities bills, by reducing the electricity consumed by lighting and HVAC systems or using cheap, renewable sources of energy to power them, green buildings can also improve business performance by enhancing the health and well-being of occupants.

A new report from the World Green Building Council (WGBC) seeks to better ascertain the benefits of green buildings for the retail sector when it comes to creating healthier indoor environments for both customers and staff.

The report, Health, Wellbeing & Productivity in Retail: The Impact of Green Buildings on People and Profit, reviews a range of evidence concerning the impacts of high efficiency, environmentally sensitive, low-carbon buildings upon users and occupants within the retail context.

It notes that the impact of green building upon the health and well-being of building occupants will have highly disparate implications for business performance in a retail context as compared to an office context, because shoppers and customers, unlike white collar workers, are free to come and go as they please.

“Workers have to be in a particular space, customers do not, and have more freedom than workers in terms of where they choose to be,” said the report.

“Because of this ‘free agency’ good environments have the potential to attract customers…where they go and how they behave in different environments are fundamentally important questions for developing the business case for greener, healthier retail spaces.”

The report says evidence is fast emerging that green buildings themselves can make for more alluring and profitable shopping destinations, and can substantially improve the performance of businesses in the retail sector by enhancing customer experience.

Case studies cited include Australia’s Stockland and their creation of a cleaner, healthier shopping environment with the Wetherill Park Shopping Centre in Western Sydney, as well as the use of skylights in Walmart chains throughout California to introduce greater amounts of natural sunlight to store interiors, saving energy costs while prompting increased sales.

Wetherill Park Shopping Centre

Wetherill Park Shopping Centre

Despite this burgeoning evidence, retail companies continue to overlook the positive impacts of green building upon store visitors or occupants themselves, focusing instead upon more readily quantifiable cost impacts.

“Health, well-being and productivity is still often divorced from the larger retail strategy,” said the report. “Money continues to be spent on improving the sustainability of stores (e.g. energy efficiency or renewable technologies) but these decisions are often taken in isolation from the primary mission of retail – namely, providing an experience that makes people want to come, stay and spend.

“Although retail is changing quickly, some within the industry continue to buy, build and manage buildings that have insufficient consideration for the people who work or shop within them.”

The report seeks to better to establish the relationship between environmental and economic performance of shopping centres or stores via the establishment of a “Retail Metrics Framework” that provides companies with a surer means of assessing and quantifying the positive impacts of sustainable building upon their business operations.

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The framework focuses in particular upon a set of 10 key environmental factors that have the potential to impact occupant health and well-being – indoor air quality, thermal comfort and lighting, acoustics – all of which are easier quantify and measure, as well as biophilia, interior layout, look and feel, active/inclusive design, amenities and community space, for which metrics are more difficult to measure given their more qualitative character.

Lighting and indoor air quality in particular are well-established as factors that can have a significant impact upon the mindset of customers and their propensity to spend.

Indoor air quality has an immediate and demonstrable effect upon human comfort, and is thus highly important to any retail setting that would seek to attract and retain the presence of shoppers.

“In the context of retail, the wealth of experiments carried out demonstrate that retail environments with lower air quality tend to have a higher client and staff dissatisfaction level,” said the report. “[This] will in turn lead to less time being spent in the retail environment and fewer repeat customers.”

Lighting – and the presence of daylight in particular, has also been proven to have a pronounced effect upon the penchant for spending of shoppers.

skylights on Walmart building

“Traditionally, high levels of daylight have not been targeted in retail environments, but daylight can have a beneficial impact on health and well-being and studies have demonstrated that it also has a positive impact on financial metrics,” said the report.

“The influence of daylight on retail performance was demonstrated by an experiment that observed a maximum 40 per cent increase in sales after increasing the amount of daylight through roof lights.”

Other research cited by the report shows indicates greener, more natural surroundings increase the proclivity of shoppers to make purchases.

“When customers are shown images of retail spaces they rate places with greenery as friendlier and more deserving of their patronage; say they would stay longer and visit more frequently, and report they are willing to pay a higher price for the same product when it is pictured in a more natural setting,” the report said.

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