How Your Business Can Build A Strong Sustainability Strategy In a Saturated Beauty Industry
05/06/2023 by The Red Tree
Over the past few years, sustainability has been at the forefront of all beauty conversations. As the industry continues to surge and extend itself globally, the continued need for the world’s preservation becomes increasingly apparent.
Although companies continue to outline their sustainability strategies, there is often confusion around the real impact these strategies are making and their longevity. The beauty industry is a major consumer of natural resources, and can generate significant amounts of waste and pollution.
While many companies approach sustainability due to consumer demands, sustainability can be a key driver of innovation and competitiveness. As it encourages companies to develop new products and processes that are more efficient, more environmentally friendly, and more socially responsible.
What is sustainability?
In the broadest sense, sustainability can be defined as the preservation of natural resources and ecosystems to preserve human life on Earth. This is wrapped around 3 fundamental pillars: social equity, environmental protection and economic viability.
Social equity includes diversity and inclusivity initiatives. Looking at humans as an extension of the planet, social equity ensures that all members of society are preserved and protected. These initiatives typically point towards kids, women and BIPOC and low income demographics.
Environmental protection accounts for the world’s natural resources and sustains the world’s overall biodiversity. Meanwhile, economic sustainability focuses on creating long-term economic development for a company or nation.
Why should every company have a sustainability strategy?
Having a sustainability strategy is important for businesses for several reasons. First, it can help to reduce costs by improving resource efficiency and reducing waste. Second, it can help to mitigate risks associated with climate change, resource scarcity, and other environmental and social issues. Third, it can help to improve brand reputation and customer loyalty by demonstrating a commitment to sustainability. Finally, it can help to identify new business opportunities and drive innovation by developing new sustainable products and services.
What makes a strong sustainability strategy?
A strong sustainability strategy should be comprehensive, ambitious, and integrated into the company’s overall business strategy. While consisting of all the elements outlined below, the key component of a strong sustainability strategy is one that is adaptable and responsive to changing circumstances.
The key elements of a comprehensive strategy:
A clear vision statement that outlines the company's sustainability goals and objectives.
A comprehensive assessment of the company's environmental and social impact, including greenhouse gas emissions, resource use, diversity profile and supply chain management.
Specific targets and metrics for reducing the company's environmental and social impact, such as reducing carbon emissions, increasing energy efficiency, hiring segregated demographics and providing support for low income households.
A plan for engaging stakeholders, including employees, customers, suppliers, and local communities and how this will be communicated internally and externally.
A system for monitoring and reporting progress towards sustainability goals.
How can my beauty business become more sustainable?
Due to the vast amount of resources used and waste created by the beauty industry, there are several routes to sustainability made available. Typically, companies take the following approaches:
- Packaging solutions which include using recycled and/or recyclable materials, refillable and reusable packaging.
- Carbon offsetting which involves buying and selling of tokens to mitigate the impact of greenhouse gas emissions, through a particular carbon offset project such as reforestation, renewable energy products or blue carbon, which involves marine projects.
- Building and growing a company opens up job opportunities for local communities. Through diversity and inclusivity programmes companies are able to better the lives of those in need.
- Accreditations which effectively reflect the steps and measures that brands take. For example, a B Corp accreditation allows consumers to quickly understand how socially and environmentally conscious a brand is.
What are the benefits of sustainability for my business?
Sustainability can lead to innovation in several ways. Companies are forced to rethink their traditional business models and explore new ways of operating that are more environmentally and socially responsible. This can lead to the development of new products, services, and processes that are more efficient, less wasteful, and more sustainable.
Sustainability can also drive innovation by creating new market opportunities for companies that are able to meet the growing demand for sustainable products and services. Finally, sustainability can promote collaboration and knowledge-sharing between companies, governments, and other stakeholders, leading to the development of new solutions and technologies that can help to address global sustainability challenges.
The Red Tree is the UK’s leading international beauty brand consultancy and a powerhouse of ideas, insight and inspiration. For an informal discussion on how we might help you, please contact us.
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Any company entering The Beauty Accelerator™ competition must be based and registered in the UK.
The scheme by which investment into the winning brand will be made is the Seed Enterprise Investment Scheme (SEIS). You must be eligible for SEIS to enter The Beauty Accelerator but you do not need to be registered for SEIS. You can be in the process of applying for SEIS and receiving Advanced Assurance from HMRC, which is free of charge to obtain and certifies to investors that the criteria necessary to qualify for SEIS have been met by the company at the time of the application. You do however need to be SEIS registered at the point of investment.Click here For further information about SEIS
As is the case with all equity investments, the winning brand must be willing to provide equity stakes for both SFC Capital and The Red Tree. In addition, the winning brand might be required to pay a monthly fee for the duration of the 12 month period of assistance from The Red Tree. The size of the equity stakes for both SFC Capital and The Red Tree are unknown at this stage and will be based on the valuation of the business at the time of investment. The value of the monthly fee to The Red Tree will be determined by the scope of work required by The Red Tree and will be agreed in consultation with the winning brand. The equity stake, monthly fee and scope of work will be discussed in further detail with short listed brands during the interview stage.
Brands that applied for The Beauty Accelerator™ 2022 can apply for The Beauty Accelerator™ 2024.
Applicant brands should ideally have proof of concept – the business should ideally be in operation with at least one product currently retailing on the market, an existing website in operation and a number of months of trading.
Under exceptional circumstances, brands that are at concept stage will be considered.
There should be a team in place or a willingness to take on a co-founder at an early stage.
A business plan must be in place and submitted as part of your application to demonstrate the revenue that can be delivered.
The business should not be valued at more than £1,000,000.
All R&D should be completed as funds invested will only be used for marketing and commercial activity.
If you are short listed, you must be available to attend the virtual shortlist interview. It is likely that short listed brands will be required to attend more than one virtual interview.
If you are a Finalist, you must be able to attend The Beauty Accelerator™ Final, either virtually or in-person.
You cannot apply for or already be in the process of applying for another accelerator or incubator during the period December 2023 to December 2024.
If you are selected as a finalist, and if you go on to win The Beauty Accelerator™, you must agree to exposure of you and your brand through The Red Tree’s, SFC Capital’s and Freeths online and social channels and a possible marketing campaign.
Confirmation of the winning brand is subject to SEIS eligibility confirmation, agreement on equity stake and The Red Tree fee, and completion of due diligence.
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