Retail park cost saving ideas – dealing with the rise of operational costs
August 12, 2022
Despite footfall to retail parks increasing since lockdown, the rise in operational costs has been a significant setback for many stores. Some retail businesses are feeling the pressure to make cuts and maximise budgets, so as not to pass on price hikes to customers already feeling the pinch from a cost of living crisis. A focus on proactive energy management can help reduce spending in the right areas, so as not to be detrimental to your business processes.
Ignite understands how tough current circumstances can be for retail park businesses, and are here to help. We’ve provided some ideas to help your out-of-town retail park business implement cost-saving energy solutions by revisiting opportunities hidden throughout your estate.
Why is the Retail Sector struggling?
Retail businesses throughout the UK are in a difficult situation, with retail operating costs increasing. Many businesses are taking new measures to save money where possible. Fashion retailer Zara, for example, recently began charging for returns for the first time.
98% of finance leaders see operating costs increasing in the year ahead. While businesses may be doing what they can to cope with retail operating expenses, they may be struggling to save money without passing on costs by raising prices to customers.
Many retailers have been purchasing spaces in out-of-town retail parks, as they’re affordable and generally larger sites. Retail parks have also seen a resurgence since lockdown, but that does not mean they haven’t been impacted by recent events such as:
- Increase in national living costs, leading to a reduction in demand from consumers as they spend less to save money.
- Increases in expenses i.e. materials and goods – many factors have led to an increase in costs for materials, such as the pandemic, taxes and the Ukraine/Russia war. As these continue to increase, prices of products continue to rise.
- Increase in inflation rates – food and products have seen inflation rates surge. Retail businesses are scrambling to protect consumers from these rising costs.
- Labour shortages – there are currently more vacancies than employees, largely down to Covid and Brexit. Not only that, but with Covid cases still prevalent, many current employees are having to take time off. This means that businesses’ services are hindered, there’s pressure to increase wages and make jobs in the retail sector more attractive.
- Covid – Covid had a significant impact on the retail industry. With stores having to close during lockdowns, retailers have been working to recover over the last couple of years. While food retailers experienced less of an impact than the rest of the industry, changes in demand, supply and maintaining a safe environment has certainly had its impact.
- Supply chain delays – Brexit, labour shortages and Covid have contributed to global supply chain issues. With a shortage of delivery drivers and closing of ports, retailers are experiencing delays with receiving products and goods. If these items are in particular demand, costs of these items increase.
Retail Cost Saving Ideas
Retail park businesses can help reduce impact of cost increases without needing to increase the costs of their products or services. Reducing energy usage can lead to significant savings that will offset current and future price hikes. In fact, according to Carbon Trust, a 20% reduction in energy costs can be as beneficial as a 5% sales increase.
Ignite provides a range of solutions tailored to retailers operating in retail parks to help you deal with the rise in operational costs. We execute large scale rollouts of everything from LED lighting projects to BMS optimisations via bespoke dashboards to submeter installation to team engagement. Let’s look at some of these in more detail.
Energy Efficiency in Retail Stores
The benefits of reducing energy consumption do not stop at saving your retail business money. Retail parks have received criticism over the years for their environmental impact, encouraging large numbers of cars and the size of their shop buildings. 25% of retail carbon emissions come from retail park, shopping centres, and high street units, which could easily be reduced by implementing a retail park sustainability strategy for your business.
Every business should be making sustainability a priority. While current circumstances may have put this need on the back burner, implementing energy efficiency projects can kill two birds with one stone. Improved business processes, up-to-date technology and clear reports with the right data can lead to less energy consumption and wastage, saving you money in the long run while also limiting your impact on the environment.
Ignite’s end-to-end energy management approach means that you’re fully supported from beginning to end. manage rising costs, become a more sustainable business and work towards net zero targets. Our net zero services will transform your business, so you meet business goals and actively reduce your carbon footprint.
As part of our Net Zero services, we can help with:
Net Zero targets – after analysing your entire estate, we’ll work with you to set reasonable and meaningful targets for your business, both short and long term.
Implementation – once we know what it is we’re trying to achieve, our experts will recommend projects for each site, prioritising significant areas of improvement. We take a data-led approach, presenting key information to you in clear, comprehensive reports.
Reporting energy compliance – we’ll support you with reporting compliance, including streamlined energy and carbon reporting (SECR) and ESOS compliance services including ESOS phase 3. With a better understanding of your data, we can strategise next steps to ensure you’re actively meeting targets.
BMS Optimisation for Retail Parks
While retail park businesses need to maintain a comfortable environment for customers, that does not mean you can’t save money in this area. Often, retailers use strong, bright lights and turn the heating right up when it’s cold outside, but there are ways to reduce heating, lighting and ventilation costs without compromising on customer shopping experience.
Ignite offers bespoke optimisations and upgrades to your Building Management System (BMS), along with a custom BMS dashboard so you can easily track performance, spot faults and closely monitor results. You can put energy efficiency measures in place with just the press of a button, monitor performance and give you an impressive level of control across your entire estate.
As part of our BMS management service, Ignite enhance control of on-and-off premise equipment by either optimising current BMS or installing new systems across you estate, including:
- Heating, ventilation and air conditioning control
- Lighting upgrades and enhancements (more on this below)
- Plant/system efficiency measures, upgrades and changes
- Peak cost avoidance
We use the data collected from each site to identify energy wastage and areas of improvement to ensure that you’re actively reducing consumption and saving money. We can identify any faulty equipment and implement changes quickly and efficiently.
Click to find out more about our BMS services.
Retail LED Lighting Solutions
Following on from BMS upgrades, our experts can work with you to upgrade and install LED lighting across your estate. Lighting in the retail industry has a tendency to favour brightness to attract customers and use old technology. Our lighting enhancements allow you to carry on bringing in customers, but with a significant reduction in energy usage.
Lighting is one of the areas where retailers can make the biggest savings. So, while energy efficiency projects can seem like a high cost at first, the savings soon outweigh the initial outlay.
Ignite has experience rolling out various LED lighting projects for large businesses. From lighting upgrades to controls and refits, our energy efficient lighting solutions have saved businesses significant amounts.
Previous projects have included installing settings where lighting aligns with the light levels outside, or only switches on when someone stands beneath them. Changes like these can bring great savings for your business, minimising energy wastage. These changes are integrated with BMS optimisations.
Our experts will get to know your business needs and create a retail park energy efficiency plan for your estate. We understand the significance of lighting for retail stores, and with our BMS enhancements across your estate, customers will still experience a great shopping experience, with your business paying less for it.
Retail Cost Saving Ideas with Pets At Home – Case Study
Ignite helped leading pet care business Pets At Home to reduce energy usage while still providing a safe, comfortable environment for in-store pets and customers. Some of the services we provided include:
- Bespoke monitoring of temperature in line with animal welfare, including tailored alerts to ensure the correct temperature is maintained.
- Monitoring energy performance across Pets At Home’s estate to ensure minimal energy wastage.
- Worked with employees to improve energy performance throughout their stores.
- Installed BMS upgrades, including lighting optimisations, to allow for better control of in-store assets.
- Our team of experts touch base with Pets At Home regularly, ready to provide extra support whenever it’s needed.
Thanks to the rollout of our energy-saving solutions, Pets At Home are saving millions of pounds across their estate. With our team on-hand at all times, they continue to experience the many benefits our projects bring. Read more about our work with Pets At Home.
Energy Procurement for Retailers in Retail Parks
Now, let’s take a look at energy supply for your retail business. At Ignite, energy procurement is all about transparency and securing energy with a contract that suits you and your needs.
Ignite can procure your energy matched to your overall strategy, goals and attitude to risk. Energy procurement can seem like a complex process, but our experts have the experience required to obtain the right energy contract for your retail business needs.
We provide a transparent, jargon-free service that keeps your business’s unique needs in mind. Our team offers an end-to-end management service, meaning that Ignite works with you from start to finish. We’ll procure the right energy for your business, monitoring budgets and managing risk. Whether you opt for a fixed or flexible contact, our procurement solutions will provide complete peace of mind.
As mentioned earlier, you can choose between a flexible or fixed contract:
Fixed contract – a fixed contract provides financial security by controlling energy costs and working with suppliers to ensure you get the most value. We pay close attention to the energy market, evaluating the best times to purchase energy, so you can be aware of costs throughout the financial year.
Flexible contract – a more personalised strategy, where Ignite purchases energy directly from the source. We’ll advise you on any opportunities that arise within the market, purchasing a portion of energy while keeping in mind your attitude to risk. You spend as much or as little as you like, providing you with budget certainty.
Our expert team keeps on top of market changes to make the most of any opportunities that may arise, keeping you informed all the way. Our clear, jargon-free reporting forms the basis of your energy management strategy, using data-driven insights to plan next steps. We also aim to find renewable energy supply, ensuring that your business is helping make a difference
Corporate Power Agreements (CPPA) for Retail Parks
CPPAs provide you with more control over your energy contracts while sourcing renewable energy from specific suppliers. By being able to rely on fixed energy prices throughout the year, you can effectively budget for the financial years ahead and offset any price increases.
These contracts can be tailored to meet your needs, allowing you to purchase energy and budget for the future. CPPAs are fixed for 5-20 years, so there’ll be no surprises when receiving your energy bills. You’ll be able to offset price increases while knowing that you’re reducing your business’ carbon footprint.
Ignite makes the CPPA set up process simple, assessing your business needs to find the right CPPA contract for you. We’ll help you create a contract that best suits your needs, from Sleeved and Virtual to Multi-Buyer. There are a number of contract types on the market that you can choose from, meaning that you are completely in control.
Furthermore, CPPAs can help with your retail park sustainability plan. CPPAs are for renewable energy only, leading to an increase in green energy capacity while also helping your business meet its net zero targets. You’ll be investing in deeper green energy, making a true difference for our planet while saving money and making the most of your energy contract.
Energy Saving Solutions for retail park businesses from Ignite
Experience a full end-to-end management service by partnering with Ignite. From enhancing current BMS to rolling out a range of energy efficiency projects, we can help retail park businesses cut costs and continue your net zero journey. Speak to our expert team today to find out how we can help you tackle rising retail operating costs while reducing your environmental impact. Send us an email at email@example.com or call: 0333 023 2222.