Retail Therapy: Solutions For “Smart” Supermarkets

By John Wallace

In case you haven’t noticed, 2010 has a theme: It’s the year of all things “smart” – Smart grids, smart cars, and even smart buildings.

Many industries have begun to see the value of smart buildings, and retail stores are no exception. Retail stores like supermarkets, big box retailers and convenience stores share many of the same energy issues faced by other commercial buildings – the high costs of lighting, heating and cooling – but its dependence on refrigeration adds an even more significant challenge. Energy Star estimates that an average supermarket (50,000 square feet) spends $250,000 annually on energy costs, equating to more than $4 per square foot – one of the highest rates of energy consumption per square foot. Up to 60 percent of this cost comes from refrigeration alone. An additional $100,000 is spent on maintenance and repairs of HVAC/R equipment. Since profit margins of supermarkets are thin (as low as 1 percent), Energy Star estimates that one dollar in energy savings is equivalent to increasing sales by $59. From overall store maintenance to the precise temperature control required for perishable items, it has become increasingly important for store owners and operators to consider better energy and facility management solutions.

Some technologies have already proven to be beneficial to retailers. In fact, more than 5,000 sites have already decreased their energy expenses by as much as $54,000 per facility per year, with up to $100,000 in possible savings in operational costs per year.

Recently, Whole Foods Market announced it is strengthening efforts to reduce energy consumption at all stores by 25 percent per square foot by 2015. Smarter refrigeration, state-of-the-art lighting and controls systems, and advanced efficiency compressors for HVAC and refrigeration, will all be key to the effort. Many other store chains have begun announcing similar efforts, and this trend will likely become the norm before too long.

The Food Marketing Institute estimated that there were 35,612 supermarkets in the U.S. in 2009. If each of those supermarkets were to reduce energy consumption by $54,000 per year using Intelligent Store, the total savings would be nearly $2 billion a year! Now that’s what I call smart.

John Wallace is director of product management for Emerson Climate Technologies, a business of St. Louis-based Emerson. Emerson is offering solutions that help retail stores become “intelligent” – through an initiative appropriately coined Intelligent Store. In addition to tracking general energy usage, store owners can also customize the solution based on the store’s size, age, refrigeration and electricity needs, and even set alerts to be notified of issues such as a freezer door left ajar. Because Intelligent Store provides detailed insights on cost drivers, store owners and facility managers are able to make more informed decisions that impact their business in the long term.

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4 responses

  1. Thanks for putting this article together, John. This is exactly the type of information that we need to be pushing when making the business case for sustainability, particularly for smaller enterprises. While it is great to demonstrate the benefit of reducing energy costs and improving your business' reputation through sustainability, it is not enough for most small businesses to invest in changes they need to make.

    Instead of focusing on these concepts, we should instead be putting the attention on items like this – the tangible, quantifiable benefits that show businesses that not investing in sustainability will be more costly in the long run. That is one of the main items I am trying to push here with COSE to the small business community in Northeast Ohio. Energy efficiency and sustainability has so many benefits that one does not immediately recognize – increased productivity, reductions of employee errors & sick days, greater sense of well-being, better ability to recruit and retain employees. All of these things are vital to making the business case, and they are ones that we cannot afford to overlook. This article presents just another strong component in that suite of arguments for sustainability.

    – Tim Kovach
    Product Coordinator for Energy at COSE

    1. Great points Tim. I really appreciate your comments and completely agree with you. While sustainability initiatives are certainly very important, we've found that it's generally easier to get buy in across organizations when there is a real, tangible improvement in operations that can drive value (i.e. energy savings or maintenance savings).

      John Wallace

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