Kroger Co.’s decision to ban plastic bags charts a separate path from Walmart Inc., its biggest grocery rival, as both chains look to burnish their sustainability bona fides.
Both companies have made sustainability a focus of their global operations, but Walmart has looked inward for improvements while Kroger’s latest efforts are part its bid to green itself in ways its customers can see. Taken together, the retail giants could shift the way their competitors and suppliers operate.
“This recent decision on plastic bags is absolutely about Kroger trying to differentiate itself from a consumer standpoint,” said Shannon Bedore, managing director for Sightline Retail, an adviser for suppliers of big-box stores.
“Kroger’s position is they want the customer to participate in and take ownership in some of these sustainability decisions,” Bedore told Bloomberg Environment.
To do this, Bedore said, the company strategy includes stocking shelves with more niche brands, in addition to the bag ban.
Whereas Walmart’s focus, she said, has been on operations and infrastructure, with such actions as reducing packaging, improving fuel efficiency, or measuring carbon emissions from suppliers. While both strategies may have the same goal, it’s still too early to tell who is making the most impact.
“But I do think it’s an interesting way for Kroger to think about their customer demographic,” Bedore said. “I don’t think the average Walmart customer would be able to walk into a store and articulate what Walmart’s priorities are from a sustainability standpoint.”
Walmart’s Supply Chain Focus
While perhaps not grabbing as many headlines as bag-banning companies, Walmart is charting a different path toward becoming a global leader in sustainability.
The company has set a 50 percent renewable energy goal by 2025. Walmart has also asked its suppliers to cut 1 billion metric tons—a gigaton—of carbon dioxide from its supply chain by 2030. That would be the equivalent of Brazil’s annual emissions.
“From a supply chain standpoint, what Walmart is doing is pretty unprecedented. No other company has done this,” said Kyle Harrison, an analyst with Bloomberg NEF.
According to an Aug. 28 Bloomberg NEF report, 400 of Walmart’s approximately 100,000 suppliers made commitments to reduce their emissions as part of Project Gigaton.
Companies can contribute in six different ways, through improvements on energy, agriculture, waste, packaging, deforestation, and product use.
These kinds of supply chain projects are still very new, Harrison told Bloomberg Environment, with Walmart and Apple Inc. paving the way. But they could spread to other large retailers as well.
“I think the first ripple effect you might see will be with internal sustainability projects—such as reducing waste, internal clean energy use, wastewater recycling,” Harrison said. “Then down the line a few more years you could see more companies trying to adapt their entire global network.”
More Bans Likely Coming
Environmental groups have said for decades that single-use plastic bags are an environmental scourge that litter the landscape and harm wildlife on land and at sea.
Several hundred jurisdictions across the U.S, including the state of California and the District of Columbia, have adopted bans or placed fees on single-use plastic bags.
Several retailers, including IKEA and Whole Foods, have also eliminated single-use plastic bags. The fact that Kroger, the largest grocery supplier in the U.S., plans to follow suit shows how important sustainable packaging has become for the retail sector.
“When our company’s phaseout of single-use grocery bags is fully implemented, the waste generated by these bags at our family of stores will drop by 123 million pounds per year,” Kroger CEO Rodney McMullen wrote in an op-ed for USA Today.
According to the Environmental Protection Agency, Americans go through about 380 billion plastic bags and wraps per year, which uses 12 million barrels of oil to manufacture.
Data from the most recent Coastal Clean-up Day showed that since California’s ban went into effect in 2016, plastic bags dropped from 7.4 percent of litter collected in 2010 down to 1.5 percent in 2017.
“For decades, plastic bags were one of the most common items collected during the annual California coastal cleanup,” John Laird, California secretary for natural resources, told Bloomberg Environment.
Long Phaseout Time
While Kroger’s announcement came as good news to many, others have pointed out that seven years is a long time, especially because the company goes through nearly 6 billion plastic bags per year, less than 5 percent of which are recycled.
“By 2025 we’ll probably have national legislation banning single use plastic,” said John Hocevar, oceans campaign director for Greenpeace USA.
Kroger’s Seattle-based subsidiary, QFC, with 64 stores in the Pacific Northwest, will be the first division to eliminate the bags by 2019. From there, it will roll into other subsidiaries, including Harris Teeter, Ralph’s, Fred Meyer, and King Soopers.
Skepticism toward the long phaseout time is fair, but the decision was made to give customers time to transition and to find sustainable replacements, Jessica Adelman, Kroger’s group vice president of corporate affairs, told Bloomberg Environment.
Environmental groups have criticized previous attempts at bag bans that didn’t come with a corresponding fee for paper or plastic or encourage reusable options.
“What is true is that everyone can get started today,” Adelman said. “The reusable bags are in the stores now, and the sooner customers transition, the sooner Kroger will be out of plastic bags.”
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