November 27, 2021

The Stores: Outdoor Retailer Climate Commitment: Know the new ropes

9 min read

Five of Europe’s largest outdoor retailers have joined forces to set an example. A sign for climate protection.

The German online specialists Bergfreunde and Bergzeit, the Signa Sports United subsidiary Internetstores (Campz, Addnature), the chain store Sportler from Italy and the Belgian retail group Yonderland (formerly AS Adventure Group) have made a joint commitment to actively work towards achieving the Paris climate goals.
These five retailers account for around one-tenth of the European outdoor industry’s total sales, which the European Outdoor Group puts at 12 billion euros.

Reason for a top-level discussion with Matthias Gebhard and Martin Stolzenberger, the bosses of the competitors Bergfreunde and Bergzeit.

Mr. Gebhard, when we spoke in the spring, you told us about the idea of a cross-retailer climate protection initiative. That went quickly now, didn’t it?
Matthias Gebhard: Yes. That’s one point that makes this initiative so strong. Martin and I talked about it on the phone for the first time in May, then listened in on our networks. The reactions were positive across the board. Now is a good starting point for pushing such a topic.

At the European association level, i.e. in the European Outdoor Group (EOG), there are already various sustainability projects. Why are these not enough to drive climate protection in the outdoor industry forward decisively enough?
Gebhard: The EOG was fully involved right from the start. And the five of us, with the exception of Sportler, are members of the EOG as retailers ourselves. We do think that such a superstructure and such a network are important–but in this constellation we were simply able to set up the topic more quickly now.

Martin Stolzenberger: Speed is a very important point. And the companies in our constellation of five all make quick decisions.

You are both also members of Sport 2000. Are there any talks at this level?
Stolzenberger: Not to my knowledge. But of course everyone is welcome to join–Sport 2000 as well as Intersport.

Gebhard: They would be terrific multipliers. But for them, such a commitment is of course much more difficult. In any case, the goal is to get as many people as possible to join.

Matthias Gebhard, managing director, Bergfreunde

Matthias Gebhard, managing director, Bergfreunde

What exactly do you demand – from each other and from your suppliers?
Stolzenberger: To start with the simplest: We expect transparency from each other and from anyone else who joins. That figures and targets are disclosed and that there is a regular exchange of information.

And the goal is to make its contribution to the Paris climate targets? That is, to limit global warming to 1.5 degrees?
Stolzenberger: Exactly.

Just determining how much emissions you need to cut in order to make that contribution is quite a bit of math. Have all five companies already formulated corresponding science-based targets (SBTs)?
Gebhard: Yes, all five partners are either in the process of formulating targets based on the SBT or have already done so. And more and more companies are doing so. We had a seminar with representatives of the SBT initiative just a few days ago. The number of participating companies has doubled within a year. In principle, the companies are already one step ahead of the politicians. It’s totally important that we don’t just do this out of a sense of moral responsibility, but that we are driven by an entrepreneurial reflex. If politicians take seriously what they have committed themselves to in the long term, then many rules will have to change in the next few years. We don’t yet know how. But as a company, it is of course only smart to position ourselves accordingly beforehand.

As a retailer, you can only influence a fraction of the emissions generated by the products you sell. Most of it happens at the supplier. If large companies commit to SBTs, they must ensure that their suppliers also set themselves corresponding climate protection targets. For smaller companies, this is optional. How do you handle this?
Stolzenberger: We assume that around 90% of emissions are generated by our suppliers. We have included these Scope 3 emissions for our sites.

Gebhard: So do we. That’s the leverage we have as an outdoor industry. How do we manage to decarbonize the goods we sell? To do that, we as retailers first have to do our homework. But the mammoth task is in the product. Working towards this is one of our goals. It helps enormously if everyone agrees on the strategic focus. What we can do as dealers is say to the industry, ‘Take this issue seriously.’ Because we don’t have a lot of time. It takes a year and a half, two years to even start to seriously develop decarbonization strategies. Then nine years to 2030 is pretty damn short.

Bergfreunde is officially climate neutral, Bergzeit is not. Why?
Stolzenberger: We have thought about it. But we don’t think the paths that are being taken at the moment are necessarily effective.

Bergfreunde team event

Bergfreunde team event

So it’s about CO2-compensation?
Stolzenberger: Exactly. We believe that we can make more of a contribution to the climate targets by other means, namely by reducing emissions, not by offsetting them. The label climate neutral is not worth it to us at the moment to go down this path. We reject offsetting, i.e. the purchase of certificates, because it is not the right way to go. You cannot achieve climate neutrality by buying certificates. But of course I can’t rule out the possibility that we will do so one day.

Gebhard: Today, climate neutrality is a construct, a crutch. Of course, reducing our own emissions must be our top priority, and we are working on this continuously. Nevertheless, it was an important approach for us to consider what we should do with the remaining emissions that we cannot yet avoid.

However, Bergzeit is one of the few companies to be EMAS-certified. This is considered a very elaborate process. Is it worth it?
Stolzenberger: Yes. Because the bottom line is that it is very effective. We have improved many processes internally as a result. Achieving our SBT is no problem for us in this setup. I would also call on other companies to think much more in this direction. There is help and support for companies to improve their carbon footprint without buying certificates. EMAS provides a very good framework for this.

In addition, you now record for each product whether it fits into your sustainability grid by meeting special social, ecological and/or animal welfare requirements. Does a seal improve the performance of a product?
Stolzenberger: There is no simple answer to this question. But it is basically the case that the conversion rate increases massively when a product is labeled as sustainable. There are retailers who simply flag items as ‘sustainable’ without checking or explaining why. We didn’t want to make things so easy for ourselves at this point and are very transparent about what makes each product a more sustainable product. However, we have to make further adjustments here. Obviously, customers want things to be simpler and don’t want to have to deal with the issue in detail.

Have you already discontinued business relations with some suppliers?
Stolzenberger: No. That was not the primary intention. It was about creating transparency for the customer and providing orientation.

Martin Stolzenberger, managing director, Bergzeit

Martin Stolzenberger, managing director, Bergzeit

But of course that remains the crucial question – even with your current commitment: What happens if the requirements are not met?
Stolzenberger: That’s something every retailer has to decide for himself. There is no vote in this initiative – nor should we. After all, we are all competitors.

Gebhard: At the corporate level, we can certainly say that manufacturers who cannot show us that they are strategically dealing with the issue of climate protection will lose strategic relevance. We can say that as mountain friends, but not as a group for antitrust reasons alone. But we are already noticing that the brands that are in high demand with us have a strong sustainability footprint. Patagonia, Vaude and Ortovox, for example, have long stood credibly for these issues.

What kind of clout can this voluntary commitment by five or, in the future, more retailers actually have?
Gebhard: You might have to classify that a bit. We are talking about the future. We’re talking about change processes that really take a long time. The point is to make it clear now that the issue is relevant. It’s about igniting a spark. The louder the voices become, the easier it is for a CEO to allocate resources accordingly, an initial amount of X. And this entry is comparatively low-threshold. At the same time, this start is comparatively low-threshold. As a company, I don’t have to invest 1 million euros directly in climate protection.

Stolzenberger: Of course, a long-term sustainability strategy involves investments. There are CSR contacts in every department. We are currently building a huge photovoltaic system on our new warehouse and are becoming an electricity provider. That all costs a lot of money at first. But if we do nothing, it will cost even more.

What reactions do you expect from the industry?
Gebhard: We’re throwing a stone in the water. We don’t know yet where the waves will go – but we have to make some.

Stolzenberger: Getting the discussion going is the most important thing. That we move in the same direction and bring in transparency.

Your suppliers have enough on their plate right now with problems in the supply chain. Now you’re coming along and adding another wrinkle. Do your partners have the nerve now?
Gebhard: Possibly not. But that doesn’t change the relevance. Of course, there are day-to-day difficulties. But if, as an entrepreneur, you always put them off so that you don’t have to work on the long-term problems, you have no prospects, I would argue. But I think everyone understands that. Many things are not mutually exclusive. The current discussion about bringing parts of the supply chain closer to Europe again, or even to the EU, so that we are not so dependent on global trade and goods flows, is of course also a lever in terms of the climate footprint of products. And that’s just one example.

Why is industry not yet as far along as it should be?
Stolzenberger: As a retailer, I’m not in a position to judge. For manufacturers, of course, it’s a very complex issue. But some of them also lack the will. The outdoor industry has always functioned well, there was never really any reason for change. That’s different now. Customers and employees are demanding it. But of course we already see that many of our top suppliers have already done a lot with climate protection.

Gebhard: You could also ask me the question. Why are Bergfreunde only doing something now? The Paris climate protection targets have been in place since 2015. It’s a scandal that we, of all people, as an outdoor industry that stands for nature, didn’t close ranks six years ago and take action together.

Bergfreunde established certain sustainability goals

Bergfreunde established certain sustainability goals

Thanks for the questions. So why only now?
Gebhard: I have to be quite self-critical and say that we started a few years too late. There were always issues that were higher up on the agenda. That’s why I can understand it very well. The point at which we said, ‘That’s enough, now we have to do it too!’ was during a panel discussion with representatives of Fridays for Future at the European Outdoor Summit.

Your demands on your suppliers in terms of climate protection are increasing. At the same time, you continue to offer your customers free returns. Some people might interpret that as hypocrisy.
Gebhard: What do returns have to do with it?

Returns that cost nothing increase the number of packages sent back and forth, I would argue.
Gebhard: As far as we know, returns are not a dramatic problem from a climate perspective. Return shipping is significantly more climate-friendly than shipping to the customer, and that has to do with the organization of logistics. And of course we are all working to ensure that our returns rates are as low as possible. On the other hand, from our point of view, simple returns are part of an online shopping experience. At the same time, of course, we are significantly improving the carbon footprint of our goods shipping. DHL is also looking at science-based targets, for example. And I don’t think it’s at all illusory that goods shipping will be more or less emission-free in a few years’ time.

Are you actually talking to Zalando as well? The company has been committed to Science Based Targets for a few years now and is turning a really big wheel.
Stolzenberger: I would definitely welcome that.

Gebhard: We are in exchange with our colleagues from Zalando and from About You. And that’s good. We have no fear of contact there. The more traction behind it, the better.

[NOTE: The original version of this article has been published 30 September 2021 on textilwirtschaft.de.]

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