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How to define "eco-friendly" shopping?

There has been a heated discussion on whether online shopping creates more problems than traditional offline shops. More people consider this topic, especially covid has impacted the world. Physical/local shopping advocates claim that they did their best to keep the carbon footprint low. The ideal case seems to consolidate the merchandise to one marketplace with a full container load and fulfill a group of shoppers' needs. However, my 20+ years of experience in manufacturing and e-commerce business tells me to view the issue very differently.

Why physical shopping creates more pollution, much more than you think?

Purchase more than required
According to recent business research, 8 out of 10 impulse buys are made in a brick-and-mortar store. (Note 1) Take a look at your wardrobe, and see how many unnecessary things. Businesses carefully design the routes and decorations in their stores to manipulate you to buy more. (Note 2) Ever trapped in the famous furniture store where there is only one direction of the route? You will buy much more than you planned before you walk in.
Solution: Buy when and only when you need it!

Initial entrance costs
If you pay a visit to the physical stores, you had already incurred traveling/time costs before you arrived. Whether it is a 15-minute bus or a 10-minute drive, it costs you something to get there. You may even need to pay an additional parking fee before you can shop. Many shopping malls provide free-parking and price-cut trying to "eliminate" this cost.
Solution: Shop online to avoid such inefficiency.

Overstock in the local/superstores
Think about how many obsolete stocks are dumped to the landfill for overstocks and change of trend. Even the best prediction model cannot match the actual consumer demand. Indeed, 53% of the unplanned markdown costs for retailers is created by misjudged inventory decisions. (Note 3) The "bullwhip effect" is one of the main reasons for over-or-under-estimation. (Note 4) The longer the stock refill and manufacturing lead time, the worst the issue can be.
Solution: Order directly from the manufacturer or a store involving a "shorter" supply-chain.

Unavoidable slotting fees
Before a customer picks an item from the shelf, costs such as production, logistics, and pre-packing have been incurred. A considerable amount of "slotting fees" was charged by retailers to cover the scarce and valuable space and logistics. (Note 5)
Solution: Order online directly from the supplier.

Goods made locally but with imported materials
Some goods claimed to be "produced locally" are actually "assembled" with materials sourced from different parts of the world. Chances are the imported materials traveled half the globe to get to an artisan's house. It is hard to determine the final product is still eco-friendly.
Solution: Order from manufacturers who source their materials locally.

Note 1> "The State of Impulse Buying Persona – Statistics and Trends"

Note 2> "The Impact of Visual Merchandising on Sales"

Note 3> "US Retailer Survey: Revealing the Hidden Costs of Poor Inventory Management | Coresight Research

Note 4> "Supermarket goods listing fee & slotting fees"

Note 5> "How To Reduce The Effects Of Backorders and Prevent Them Altogether"

Harry Kwok, FCCA
Harry Kwok is the GM of Obook Trading Limited. As the co-founder of EcoFans® brand, Harry leads the newly created online store to focus on offering high-quality, eco-friendly products to realize the team's vision to promote a more environmental-responsible living style.

Harry has 20 years of experience in the accounting/manufacturing industry and is a fellow member of the Association of Chartered Certified Accountants. Prior to joining EcoFans®, Harry was the Financial Controller of Lever Style Limited (SEHK:01346), listed on the mainboard of Hong Kong Stock Exchange. He was head of accounting overseeing reporting/compliance issues during the IPO and co-led ERP implementation.

Harry had held various senior management positions in the manufacturing and trading sectors in Hong Kong, Shanghai, and Shenzhen. He spent the first six years of his career in Auditing with Ernst & Young CPA.

Harry holds a Bachelor's degree in Business Administration from The Hong Kong University of Science and Technology.

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