Despite High Initial Cost, Outlook’s Bright for EE Light Bulbs
Michael D. Sleeper, President/CEO, Imperial Distributors, Inc.
How will these tough economic times affect supermarket non-foods?
Reports show that trading down has already begun in food and non-food categories. Items adversely affected are such higher-priced products as refrigerated orange juice vs. condensed varieties; gourmet/specialty/prepared foods and large “economy” sizes vs. regular/small sizes throughout the grocery and non-food aisles.
But will the recession affect sales of energy-efficient light bulbs, a new “star” in general merchandise? Will their high initial price vs. long-term value cripple the new line before it receives the shelf position and the space it deserves? Will EE bulbs achieve its potential as an energy saver that assists the environment and saves customers money long-term?
At first glance, the situation doesn’t look favorable. But a second look reverses the negative. Two huge factors are compelling.
First, the world’s largest retailer is pushing its greening agenda to brighten its image as a caring company. Promoting compact fluorescent light bulbs plays an important part in Wal-Mart’s image. Lee Scott, former CEO, said at the company’s annual meeting last year, “Wal-Mart customers are able to cope with higher energy costs because we are helping them stretch their money on everyday needs.” He added, “Even more, we are helping the environment in the process.” He pointed to Wal-Mart’s push to sell the compacts--which was announced in Nov. 2008 as having a goal of selling 100 million of the bulbs--had actually sold 182 million of them by last summer. “Over the life of the product, these bulbs will save our customers nearly $6 billion and keep the equivalent of three coal-fired power plants off the electrical grid.”
Second, the U.S. government supports EE bulbs though a special Energy Star agency program, and the government’s most powerful force, our president is a supporter. President Barack Obama, at the top of his popularity and an ardent greening advocate, can be expected to promote EE bulbs as a part of an agenda calling on all Americans to help conserve the environment and reduce the nation’s dependence on foreign oil.
The preamble to the Obama/Biden Plan, which outlines proposals to invest in renewable and alternative energy sources, lays it on the line. It states that our addiction to foreign oil “doesn’t just undermine our national security and wreck havoc on our environment—it cripples our economy and strains the budgets of working families all across the country.”
Among ways to defeat the problem is to “deploy the cheapest, cleanest, fastest energy sources.” And that ranges from green-type buildings to new energy efficient light bulbs with unit sales numbering in the millions. Given Obama’s ability to inspire Americans to consider their country’s needs as their own, compact energy efficient light bulbs will present a viable rallying cry.
Information Resources Inc.’s Times and Trends Report found that grocers gained over half a share point with sustainability-driven shoppers, which gives grocers an edge over mass and dollar-store channels. The research found that half of U.S. consumers consider at least one sustainable feature when selecting a store to shop.
Green means more business. It can make a difference despite these tough economics times. Thankfully, supermarkets and non-foods have a bright outlook with energy efficient light bulbs.
Despite High Initial Cost, Outlook’s Bright for EE Light Bulbs