INDIANAPOLIS — Wal-Mart Stores is seeking to merge the issues of price and sustainability in the minds of consumers, one of the company's top executives said at a conference here.
“An investment in [sustainability] contributes to how we can reduce the price to our customer,” Jack Sinclair, the executive vice president of the Bentonville, Ark.-based company's grocery division, said at the Center for Food Integrity's 2008 Summit, “It's not a cost premium. It's a cost minus.”
Sustainability, by Wal-Mart's definition, involves asking whether the products on its shelves maximize the efficient use of materials, close material loops and minimize waste. In addition, a product must also promote the integrity of nature, maximize the use of renewable energy or minimize greenhouse gas emissions, and the promote quality of life.
For that reason, Sinclair applauds companies like Sara Lee, producer of Hillshire Farms and Jimmy Dean brands, for trimming the height of its dairy cartons by three-sixteenths of an inch, which also lightens overall weight. That change alone allows the manufacturer to use fewer trucks and fewer pallets, and reduces plastic use and carbon dioxide emissions. Likewise, by flattening the noodles in its Hamburger Helper product, General Mills has reduced its packaging by 30%, Sinclair said.
In 2007, Wal-Mart announced that it would only sell concentrated liquid laundry detergent in all U.S. stores by May 2008. The move saved more than 400,000 gallons of water, plus cut use of plastic and cardboard, Sinclair said.
Shoppers take more notice of things like fresh produce, an area where Wal-Mart said it is finding savings through its local-sourcing strategy. Setting up distribution centers in communities where farmers can deliver their goods allows the stores to provide fresher products, and boosts the local economy, Sinclair said. For instance, Fry Farms, a producer of watermelons and cantaloupes in eastern Illinois, grew from small truck farmer status to a business supplying more than 1 million pounds of fresh fruits on a regional basis.
Sinclair is seeking to streamline processes that encourage similar partnerships because the farm-to-fork distribution keeps overall prices low and raises customer satisfaction. “Our request to local producers: How can we work much closer and intensely to deliver what will make this a triple win in terms of price, freshness and sustainability?”