Growing a Green Business - Page 3 of 7

Growing a Green Business

company–Target recycles hundreds of millions of pounds each year of cardboard, shrink-wrap, and other plastic. Xerox Corp. last year announced that in four years, it had exceeded its goal of reducing its greenhouse gas emissions by 10%, actually achieving an 18% cut in emissions. The commitment seems to be here to stay. black enterprise surveyed the Websites of the 20 largest corporations in the country and found that 14 had a reference to the environment or sustainability on their home page.

The business-to-business market is not driven just by the desire of corporations to be good citizens, of course, it’s also about the bottom line. Wal-Mart Stores’ well-publicized drive to make its 7,200 trucks more fuel-efficient is saving the company tens of millions of dollars a year in fuel costs.

Claude Kennard understands that corporate self-interest. The 59-year-old alumnus of British oil producer BP p.l.c. is now the president and owner of Metal Alloy Reclaimers Inc., a Cleveland-based recycling firm focused on oil refineries.

The business, known as Metaloy, earned revenues of $1.2 million last year by helping refineries recycle materials used in the process of turning oil into gasoline and other end products. Its research and financial support have resulted i
n two spinoff businesses since 2004: MCAT Services, which processes waste material for reuse by refineries around the world, and MAR Systems, which uses a refinery byproduct to remove hazardous metals from water and industrial waste streams.

Kennard hopes that the desire of refineries to economize through recycling will help lift MCAT Services, which nabbed its first customer, Sunoco Inc., late last year. And the water purification firm, MAR Systems, is working with the Environmental Protecton Agency on technology to help provide municipalities with cleaner water and potentially boost the company’s business, he says.

Indeed it’s also important for business owners to recognize that state and local governments are among the most promising institutional buyers of green products and services. For instance, Phoenix’s City Council gave the green light for its procurement officials to systematically shift the products and services it buys to environmentally friendly ones. “We are completely reorganizing our purchasing around sustainability,” says Darice Ellis, an environmental quality specialist. “We are going to go contract by contract to incorporate green requirements.”

Coveted government contracts are typically locked up for years by incumbent firms. But in all of the supplier contracts that Phoenix evaluated by late last year, Ellis says that half the vendors would have to be replaced because they did not offer a green version of their office products, pesticides, janitorial supplies, or other goods.

With a five-year transition plan to green procurement, Phoenix’s program is an excellent example of how the green movement is opening doors for minority-owned firms. Even as it looks for green suppliers, the city is applying its pre-existing incentives to attract minority-owned contractors. Such businesses can place bids that are as much as 5% higher than their rivals and still win contracts, explains Elizabeth Paulus, Phoenix’s environmental program specialist. “We want to get the best priced green