If you think selling burgers and bettering the environment are mutually exclusive endeavors, don’t tell Jeff Harvey.
The chief executive of Burgerville, a Pacific Northwest chain of 39 fast-food hamburger outlets, has set out to prove otherwise since taking on his initial role of chief operating officer with the company in 2004.
“Why would a restaurant company do this?” says Harvey during a recent telephone interview from his office in Vancouver, Washington. “It’s not a moral story I’m trying to preach. It’s the pathway to smart and sustainable business.”
Case in point: Currently more than 60 percent of the restaurant company’s garbage avoids ending up in landfills due to an employee-led recycling and composting program begun in 2007; once that amount reaches a company-wide goal of 85 percent, Burgerville expects to pocket some $100,000 in yearly waste removal savings.
The monetary gain is in addition to the obvious benefits of reduced pollution and stress to the land. “It’s a long-term business strategy,” says Harvey.
His company’s sustainable efforts are pervasive and clearly communicated to employees and consumers through education and visibility at the store level. Last year Burgerville recycled nearly 70,000 gallons of used oil from its fryers, the result of an initiative begun in 2006; nine of every ten gallons are converted into cleaner-burning biodiesel fuel. Last year Burgerville introduced a sustainable packaging program.
The green efforts began in earnest shortly before Harvey’s arrival more than five years ago; that’s when Burgerville took a major gamble, shifting its beef sourcing away from the commodity markets to a cooperative of local ranchers practicing sustainable agriculture and cementing an earlier commitment made by the company.
“The buzz was very significant and the (customers) were very appreciative of it,” recalls Harvey. “Our guest-count numbers spiked upwards.”
The company then turned its attention to the energy markets, tapping Harvey’s expertise as a former executive at Chevron and PG&E. Burgerville now purchases wind energy credits from local utilities that are equivalent to 100 percent of the power used at its restaurants and corporate office.
“I recognized that there was a distinct opportunity here,” says Harvey, a longtime friend to Tom Mears, chairman of Burgerville’s privately held parent, The Holland Inc. “Even though the company had lived by its values since its founding, those values hadn’t been fully utilized to drive market strategy.”
SCALING PROGRAMS
Burgerville learned a lot about the rollout of green initiatives from its beef program, he says. Among the most useful lessons: partnering with local suppliers to help them build scale and setting realistic goals that don’t overstress your company’s resources. Today that list also includes performing careful due diligence to ensure that would-be suppliers live up to their promises.
“For me it kind of charted the course toward other decisions,” says Harvey, whose company now gets 70 percent of its ingredients from local suppliers, ranging from organic eggs to Tillamook cheese. Local farmers provide the makings for seasonal menu specials such as this month’s Cherry Chipotle Pulled Pork Sandwich, which includes fruit from the Oregon Cherry Growers.
Burgerville receives some 35,000 to 40,000 pounds of hamburger a week from the beef cooperative, Country Natural Beef. To facilitate a better understanding of the market, ranchers periodically work in Burgerville’s restaurants getting to know the crew and customers up close and personal.
“We’ve got a much higher quality product,” says Harvey, noting that patrons pay a premium for Burgerville’s meals, which are pricier than those of national chains like McDonald’s. According to the company’s online menu listing, a Burgerville Classic Hamburger sells for $3.39; the Half-Pound Colossal Cheeseburger goes for $5.29.
The green efforts haven’t hurt results: under Harvey’s leadership, same-store sales have increased to double the industry average in the past two years. Burgerville doesn’t disclose specific numbers but Harvey says yearly sales are in the ballpark of roughly $70 million.
It helps that Burgerville is located in the Pacific Northwest, where environmental endeavors are seen as a priority. But increasingly, green efforts are becoming top of mind for many small businesses, whose nimble size gives them more flexibility in execution.
“Every place you look there are small businesses greening this, greening that,” says Byron Kennard, executive director of the Center for Small Business and the Environment, a nonprofit group. “Green technology is succeeding because it’s superior.”
One of the best outcomes, says Harvey, is the ripple effect that initial efforts can have, as sustainable initiatives gain momentum and spread. This happened when Burgerville began its energy credit program, a move that was suggested by regional utility Portland General Electric.
“Portland General Electric said we only serve a number of your restaurants,” says Harvey. “We said we understand but if you want to do this deal we want your help in getting all of our restaurants served.”
So the utility used its program as a model and helped teach other regional utilities how to create similar offerings. Likewise, when Burgerville decided to convert its cooking oil, there wasn’t enough hauling capacity to serve all of its restaurants, so it worked with local converter SeQuential Biofuels to help build out the market.
“What’s so cool about that approach is that it created other programs where those programs didn’t exist,” says Harvey. “We’re a community oriented business. Our restaurants are geared toward the communities where they’re located.”
source: http://www.reuters.com/article/smallBusinessNews/idUSTRE5743KJ20090805?sp=true
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