BY MITCH MAC DONALD, GROUP EDITORIAL DIRECTOR outbound
When green opportunity
comes a-knocking
JUST A FEW SHORT YEARS AGO, SUSTAINABLE (AKA GREEN)
business practices were all the rage. Everyone wanted to learn more
about ways of doing business that were not only environmentally sustainable but also yielded bottom-line benefits. Magazines like this one
scrambled to satisfy readers’ almost endless appetite for stories about
companies that were turning green into gold and trash into cash.
Then came the Great Recession of 2008–2009. For a while, it looked
like the economic blues might derail those green efforts. But the green
movement proved to have staying power—no doubt because of the
overwhelming, and well-documented, evidence of
the financial rewards.
All this helps explain why we’re once again hearing a lot of green success stories. The company profiled in this month’s cover story is a case in point. As
Senior Editor Toby Gooley reports, online retailer
Other World Computing (OWC) has become a
staunch believer in the power of green. The company built its Woodstock, Ill., DC with environmental
considerations in mind. The facility meets all LEED
standards inside and out: from landscaping (all
native plants, a groundwater recycling program) to
lighting and heating (maximum use of natural
light, motion-activated LED fixtures, an underground thermal heat system) to power generation
(a company-owned wind turbine adjacent to the DC generates more
than enough electricity for the building).
The company took its environmental efforts to the next level with
a 2010 DC retrofit. With the help of systems integrator Dematic,
OWC installed order-filling lanes, packing stations, and conveyors
that allowed the retailer to handle much more volume in the same
footprint with 40 percent less electricity.
And it’s not just OWC. Another example is the Minneapolis-based
Murphy Warehouse Co. Richard Murphy, president, CEO, and
fourth-generation leader of the 108-year-old family-owned firm,
boasts unshakeable green credentials, and his company has a proven
track record of following sustainable business practices. For instance,
it has already installed solar panels on five of its 10 warehouses. Plus
two of the facilities are LEED-certified, with others soon to follow.
Yet for all his eco-knowledge and experience, Richard Murphy is
still discovering new and unexpected benefits to going green. The latest came this summer, when Murphy was seeking financing for a 20-
year-old, 358,000-square-foot facility he wanted
to buy in nearby Eagan, Minn. In total, he was
looking for $6.6 million to purchase the building
plus another $3 million for upgrades that included LED warehouse lighting, new sprinklers, and
rooftop solar power panels.
Of all the financing options, the most attractive
was the Small Business Administration’s (SBA)
504 program, which offered below-market interest rates as well as a favorable
debt-to-equity ratio. But there
was a hitch. “Traditionally,
warehouses do not meet SBA
mortgage requirements or any
other public funding conditions
because we do not employ
enough people per square foot
for their loan ratios,” Murphy
explains. “This was the case
with our new purchase, but
much to our surprise, being
‘green’ came to our rescue.”
It turns out that the SBA will
sometimes waive its employee-per-square-foot requirement for investments
that produce a significant amount of renewable
energy. Because Murphy’s rehab plans for the
facility called for the installation of solar panels,
the company was able to take advantage of that
exception. The upshot: The project qualified for
very favorable financing.
“Being green opened the door for us,” Murphy
says. “This program literally gives you a financial
benefit for running a green business. It’s really
kind of cool.”
Group Editorial Director
