By Jay Fiske
The holidays may be “the most wonderful time of the year,” but they can be pressure cookers for retail facility executives.
Indeed, “tis the season” when financials really matter. Specialty retailers and department stores ring up as much as 25% of their yearly sales in November and December alone. From decorations to discounts, stores double down, using every possible tool to maximize customer revenues.
Outsiders would think the increased traffic would make this time especially merry—but sales aren’t everything in the retail sector. As with any industry, profitability is also a priority, and that’s where facility executives could be challenged this season. The soaring price of energy—previously cited by McKinsey & Company as U.S. retailers’ “fourth largest in-store operating cost”—can make a serious dent in store margins.
Moreover, managing energy use is difficult during the holidays. To attract shoppers, stores stay open longer, and managers work hard to keep these environments enticing. That means temperature and lighting have to be “just right.”
Compounding the challenge: Facility managers at major brands often have dozens or hundreds of retail locations in their portfolios. Some of these stores may follow energy-saving protocols more diligently than others. Unfortunately, individual stores may also have malfunctioning or inefficient HVAC, lighting, or irrigation systems—leading to more wasted resources.
How can facility leaders address these issues to make the most of the holidays—with further improvements in the coming year?
They should start by:
- Auditing their current equipment
- Shoring up their energy management processes
- Amping up results with technologies such as the Internet of Things (IoT)
Repair Or Replace
Retail facility executives who jumpstart energy savings now can improve their companies’ profitability, brand reputations, and the health of their planet—lighting up their holiday season.
When frigid winter temperatures approach, retailers need to avoid problems such as outdoor air dampers that won’t close or sluggish HVAC equipment that’s slow to heat a store. From location to location, it’s critical to spot issues and schedule timely proactive repairs. No facility manager wants to face a malfunctioning HVAC system on the coldest day of the year when it’s too late in the day for a truck roll.
When managers preempt last-minute problems, they can also save money. ConnexFM research indicates that reactive service calls are typically three times the cost of preventive maintenance. That’s why triaging projects is essential.
Be A Process Detective
It takes careful sleuthing to uncover all sources of wasted energy. Sometimes, the staff is too busy serving holiday shoppers to report equipment problems. Then they compound the issue by overriding the controls on malfunctioning equipment—leading to unanticipated costs.
At other times, well-meaning teams use energy wastefully because of their zeal to reach every customer. For example, it’s common for team members to leave outside doors open to attract shoppers, even as the weather gets colder.
During the holidays, retailers are reliant on temporary workers. That makes it doubly important to train everyone on balancing customer comfort with energy-saving measures—and ensure that everyone complies.
Resolve To Automate
Skilled facility leaders can scratch the surface of these best practices, one store at a time. But when new problems could emerge 24×7, at any location and with any piece of equipment, the opportunity to effect change—at scale—disappears without enterprise automation.
That is what has prompted facility executives at major national brands to bolster their energy management strategies using the Internet of Things (IoT). By connecting their equipment (HVAC, lighting, irrigation systems, and even automatic doors) and monitoring them from the cloud, they can control, automate and adjust settings in real-time and flag “deviations” that suggest waste is lurking below the surface.
For example, one national brand discovered and replaced a stuck HVAC switch that always kept the air conditioning on—enabling them to turn it down as needed.
Retailers also use this technology to reduce demand charges, which are based on businesses’ energy consumption during peak demand periods. These charges can reach 20% or more of a company’s energy bill.
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Helping The Planet
There is another holiday bonus to this process automation; it makes it easier for retailers to go green. Conserving energy and resources has taken on heightened importance in this era of ESG investing and socially conscious consumerism.
In short, retail facility executives who jumpstart energy savings now can improve their companies’ profitability, brand reputations, and the health of their planet—lighting up their holiday season.
Jay Fiske is President of Powerhouse Dynamics in Newton, MA, a leading provider of Internet of Things (IoT) solutions for multi-unit retailers, restaurants, and other commercial organizations. These include the SiteSage® platform to help retail operators reduce energy expenses, manage equipment assets and gain more operational transparency.
