Government and Green: Business Up For Grabs
If there’s one market that shows strong potential when it comes to selling environmentally preferable products, it’s the government sector. In fact, government is one of the markets where “green” purchasing is gaining the most traction. Jan/san distributors who can meet governments’ “green” product demands will see increased sales opportunities in 2005 and beyond.
Governments and other institutions will boost their spending on cleaning supplies and services by 7 percent annually through 2007, according to The Freedonia Group, a Cleveland-based market research firm. By 2007, governments and institutions will be spending nearly $16 billion annually on cleaning supplies and services — many of which will be green products.
Word Is Spreading
Local governments in Virginia and California have mandated the use of green janitorial products. State governments are following suit, says Scot Case, director of procurement strategies at the Center for a New American Dream, Takoma Park, Md. “The Pennsylvania state government issued a contract recently that requires products to be Green Seal-certified or to demonstrate that they could meet the Green Seal standard’s criteria,” he says. Green Seal is a widely recognized standard for identifying environmentally preferable products.
“Municipal governments are doing the same,” says Case. The city governments in Santa Monica, Calif., and Sarasota County, Fla., have issued similar purchasing requirements.
New York State and New York City both have legislation currently pending that would require the use of green cleaning products. The governor of New York issued an Executive Order that encourages the use of green cleaning products, Case adds.
In a number of states, green cleaning products are offered on state contract, which make it easier for agencies to buy those products.
These states include: Massachusetts, Minnesota, California and Washington.
Federal agencies are also jumping on the green bandwagon. “The Federal government’s interest in the use of green cleaning products and services is growing,” says Dana Arnold, chief of staff at the Office of the Federal Environmental Executive (OFEE). “There are a variety of reasons why, ranging from green purchasing efforts, to environmental stewardship, to pollution-prevention efforts, to concerns about employee health and safety,” Arnold says. “Today, the federal government is actively using environmentally preferable and bio-based cleaning products.
“Federal users of green cleaning products include the Navy, which has changed the products used on board ships, many of the national parks, and several affiliates of NISH, which provides employment to the handicapped,” Arnold adds.
Through the General Services Administration, federal agencies spend $200 million annually for cleaning products and janitorial supplies, including green products, estimates Joe Breen of Breen and Associates, a Washington-based fed-eral marketing consultant.
Advice for Distributors
There are a couple of ways that distributors can ensure they get their share of green-product business from governments. One way is for distributors to show customers how using green products can help them achieve LEED-EB (the U.S. Green Building Council’s Leadership in Energy and Environmental Design for Existing Buildings) green building certification, according to Deone Johnson, vice president of sales for Brissman-Kennedy, Minneapolis, a division of AmSan LLC.
The LEED Green Building Rating System is a voluntary national standard for developing high-performance, sustainable buildings. Members of the USGBC, representing all parts of the building industry, developed LEED standards for a wide variety of new or existing buildings.
Johnson believes that distributors establish instant credibility in housekeeping departments by providing information on LEED: “It’s a consultative sell — you are being a true consultant. That is really where the true value for the distributor salesperson is today.”
Taking that approach, says Johnson, will also enhance the image of the distributor in the eyes of the customer’s top executives: “It’s a different sell; it’s a high-level sell, and it will change how you are perceived by that account.” And since housekeeping operations can be responsible for one-third of the points needed for LEED-EB certification, this selling approach “positions the housekeeping crew up a notch or two in the eyes of the building management,” Johnson says.
He suggests that distributors “get familiar with the LEED green building certification program, and work with their customers on achieving that certification for their buildings.”
Several federal agencies are embracing LEED, notes Johnson: “The U.S. Department of Interior has signed a memorandum of understanding with the USGBC supporting the use of LEED-EB, while the U.S. Environmental Protection Agency (EPA) aims to have all of its new facility construction and new building acquisition projects that are 20,000 square feet or larger meet LEED certification by sometime in calendar year 2005.”
“Distributors need to understand green products and sustainability to understand their benefits, and to effectively articulate those benefits,” says Rick Woodward, corporate director of sustainability at Coastwide Laboratories, Wilsonville, Ore. Coastwide is a manufacturer and distributor of floor care and other cleaning products serving West Coast markets. “Government is a very important market segment for us,” he adds.
To get their message across about the green cleaning products they are selling, distributors need to reach the right level in the government agency, explains Jim Evans, vice president of sales and marketing at Coastwide Laboratories: “The traditional approach is to deal with people close to the actual cleaning work, in the facilities maintenance department, but they may be unaware of their organization’s sustainability objectives. So it’s often more effective to communicate with individuals higher up — people who have a role in the strategic objectives and long-range planning of the organization. These executives may be responsible for communicating to stakeholders — we call them VITOs — ‘very important top officers.’”
How can distributors locate these VITOs in a government agency? “Find administrators who have the responsibility for developing and guiding policy for that agency or institution,” suggests Woodward. Most important is to “reach executives at the policy-making level, and show them the green products your firm can offer.”
Start at the top, advises Coastwide’s Evans: “What we are finding, at least in the Northwest, is that green-product directives to government agencies are coming from the governor’s office. In Washington state, Governor Gary Locke has made that an Executive Order. Here in Oregon, sustainability and green products initiatives are coming from top officials in our state government.”
Marketing green products and sustainability programs to state government agencies requires going beyond contacting the governor’s office, says Evans.
“While the governor may have issued an Executive Order directing agencies to adopt sustainability plans, each individual agency has different opportunities to incorporate sustainability strategies into their organizations,” says Evans. “One of the things we find valuable is the ability to help those organizations identify facility maintenance issues where they can improve their performance from an environmental and human health and safety perspective. So we are often asked by the agencies to come in and discuss sustainability and how green housekeeping or sustainable facilities management practices can impact their agency.”
Coastwide presents two kinds of training seminars. One is focused exclusively on sustainability.
“It’s really not product-focused. This seminar’s main purpose is to provide an understanding of what sustainability is,” Evans says. “The second seminar we offer covers green-cleaning products and is more focused on our formulations and what Coastwide can do.”
In addition to education, Evans and Woodward also suggest that distributors create coalitions with environmental advocacy groups. “Distributors should get involved with local or regional sustainability organizations. In Seattle, there’s the Network for Business Innovation and Sustainability (NBIS), and in Oregon, there’s the Oregon Natural Step organization. These are groups are widely respected for their work in sustainability within the business model,” Woodward says.
There’s much potential in selling green products to government agencies. By learning the facts of green government sales, distributors can position themselves for access to a booming market.
Michael Keating is research manager for Government Product News and Government Procurement magazines, as well as research editor for Expansion Management magazine. E-mail Keating or a free copy of his “Selling to the Government Markets” pamphlet.
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