The year of sustainable SMEs: Expert explains why it can pay to go green!

• Save money by cutting waste

• Win over eco-conscious consumers

• Prepare for a greener future

• Make use of funding and incentives

• Unlock new revenue streams

• Practical tips for going green

• Breaking down the challenge

Joe Phelan, money.co.uk business bank accounts  expert, says:

“Prioritising sustainability isn’t just an ethical choice – it can drive profitability, streamline operations, and boost brand loyalty.

Here’s why going green is a win for your business and the environment.

Save money by cutting waste

Sustainability isn’t just about reducing your carbon footprint; it’s also about efficiency. By identifying areas where resources are being wasted, SMEs can often uncover significant cost savings.

For example, switching to energy-efficient equipment, such as LED lighting or energy-saving heating systems, can dramatically lower utility bills. Similarly, adopting digital solutions to minimise paper use or streamlining logistics to reduce fuel consumption can also add up to significant savings over time.

Win over eco-conscious consumers

A 2024 study found that 80% of consumers would be happy to pay more for sustainable products, while a separate study found that 91% of global consumers expect companies to conduct themselves with Corporate Social Responsibility (CSR) in mind.

For SMEs, this represents a huge opportunity to build brand loyalty and attract customers who value eco-conscious practices. By integrating sustainability into your business ethos—whether through environmentally friendly packaging, locally sourced materials, or transparent supply chain practices—you can position your business as a leader in a growing market segment.

Even small changes can make a major impact. For instance, a café might transition to compostable packaging, or a retailer might offer discounts to customers who return used items for recycling. These efforts can resonate with customers and help build long-term relationships based on shared, eco-conscious values.

Prepare for a greener future

Going green is no longer optional for businesses. With the government aiming for an 81% cut in the UK’s emissions by 2035, SMEs need to be ready to adapt to stricter environmental regulations. Businesses that fail to comply could face penalties, increased operational costs, and even reputational damage.

By embracing sustainable practices now, SMEs can future-proof their operations, while also potentially saving money in both the short and long term. Proactively reducing carbon emissions, improving energy efficiency, and sourcing responsibly, will ensure your business remains competitive as regulations evolve.

Make use of funding and incentives

Cost is a common barrier for SMEs considering sustainability, but financial support can ease the transition. The UK government and industry bodies offer incentives to help businesses invest in greener practices and reduce expenses.

For example, the Workplace Charging Scheme offers support to organisations for the installation of electric vehicle (EV) chargepoint sockets at their sites. The scheme covers up to 75% of the total purchase and installation costs (including VAT), with a maximum of £350 per socket, and up to 40 sockets per applicant.

Installing chargepoints could also be a valuable perk for staff and customers with EVs, making your workplace more accessible and appealing. But don’t wait too long – applications must be submitted before 31 March 2025.

Unlock new revenue streams

SMEs up and down the country are discovering new ways to generate revenue by rethinking their business models with sustainability in mind.

For example, a business could:

• Refurbish and resell products: An electronics retailer could refurbish used items for resale, tapping into a market of budget-conscious and eco-conscious consumers.

• Offer eco-friendly alternatives: A stationery business could create a line of biodegradable or recycled products to meet growing demand.

• Implement subscription models: Businesses could generate steady income by offering repair, reuse, or leasing services for products.

Practical tips for going green

Getting started with sustainability doesn’t have to be overwhelming. Here are a few simple steps SMEs can take today:

1. Audit your energy: Identify areas where energy is being wasted and, where possible, switch to energy-efficient alternatives.

2. Reduce reliance on single-use items: Transition to reusable or compostable packaging and supplies. This is, for many SMEs, an easy quick win.

3. Source locally: By partnering with local suppliers, you will be able to reduce transportation emissions while simultaneously supporting nearby businesses. A win-win.

4. Engage your team: Encourage employees to contribute ideas for reducing waste or improving efficiency within your operations, and do all you can to get them involved. Many hands, as the saying goes, make light work.

5. Measure your impact: It’s important to track key metrics like energy usage, water consumption, and waste reduction. This will help you better understand your environmental performance and will ensure you can see improvement.

Breaking down the challenge

Concerns about cost or uncertainty about implementation can—understandably—deter SMEs from embracing sustainability. However, these barriers can be overcome with the right mindset and support.

For example, it can be beneficial to focus on just one or two changes initially – perhaps upgrading to energy-efficient equipment or reducing paper use. It could also be worth joining networks like the British Chambers of Commerce and reading up on how the Small Business Charter could provide assistance.

For UK SMEs, going green is a strategic decision that is likely to benefit both the environment and your business’ bottom line. From reducing costs and attracting eco-conscious customers to unlocking new revenue streams and staying ahead of regulations, sustainability offers a clear path to long-term success.”