UK businesses ‘thrift shift’

Posted on 9 Dec 2009 by The Manufacturer

The recession could leave a legacy of improved resource efficiency as businesses adopt an increasingly ‘thrifty’ mindset, according to a report published today by Envirowise.

The Envirowise Business Thrift Shift Report, which encompasses responses from more than 500 UK companies, reveals that almost three-quarters (73%) of businesses have developed a more detailed knowledge of their spending and resource use as a result of the recession. This includes investment in raw materials, transport and energy, to staffing, equipment and professional services.

For businesses, reduction of spend on raw materials and consumables was the biggest area of cut back (38%), with a large number also minimising their water, energy and transport use. Indeed, this ‘thrift shift’ is set to continue, with 89% of respondents expecting to be more careful about how they use their resources once recovery comes.

Simon Drury, Envirowise Strategic Partnerships Director, said: “Businesses — particularly SMEs — have been facing some serious challenges as a result of the recession, and this is perhaps reflected in the number of survey respondents reducing staff costs during this period (41%). However, it is also clear that for many companies this period of economic difficulty has stimulated a more resource-conscious mindset, galvanising environmental commitments that had perhaps been lower down the business agenda.

“We know from experience that resource efficiency goes hand-in-hand with profitability, so it is encouraging to see better management of raw materials, energy and water forming an important component of the business response to recession in the UK.

“Such an approach does not only lead to financial savings; it can also equip businesses to face increasing levels of environmental legislation and provides an important competitive advantage as customers become more environmentally conscious. These companies are not only more likely to survive the recession in the short-term, but are also better placed to thrive when the economy begins to recover.”

Commenting on the research, David Caro, Chair of the Federation of Small Businesses’ Environment & Energy Committee, added: “Faced with a recession that is now in its sixth consecutive quarter, small businesses have had to adapt to survive. The downturn has brought increased spending constraints for our members which have been exacerbated by the problems of accessing credit during these difficult months.

“Yet this tough economic climate has also focussed attention on increasing resource efficiency, not only to maximise costs savings, but also to meet the growing demand for resource efficient goods and services. There is a growing consensus among the SME community that resource efficiency is not just a symptom of the current downturn but essential to remain competitive in the transition to a low carbon economy.”

The Report is available at: