EXCLUSIVE: Lidl challenges ‘misconceptions’ of discount retail in sustainability report debut

Lidl has strived to "challenge any misconceptions" about the relationship between sustainability and discount business models in the retailer's first ever CSR report, which outlines ambitious targets in areas such as food waste and responsible sourcing.

Launched this week, Lidl’s report aims to show that offering customers low prices and delivering sustainability are not mutually exclusive actions. Four key commitments reinforce this vision; buying British, sourcing responsibly, tackling food waste and supporting healthy lifestyles.

Underpinning the retailer’s sourcing targets is an aim for 100% of its own-label frozen and fresh food to be sustainably sourced by 2019, with a pledge to sustainably source all of key commodities, such as cocoa, tea palm and bananas, a year later.

The food waste strategy focuses on a 2020 target to slash discarded food from its stores by one-quarter, alongside plans to redistribute all surplus food from its stores by 2019.

Speaking exclusively with edie ahead of the report’s launch, Lidl’s CSR manager Mark Newbold admitted that Lidl had not been vocal enough to date about its efforts on environmental and social issues.

He expressed hope, however, that by bringing the retailer’s sustainability information together for the first time, stakeholders could be reassured about the company’s commitment to the sustainability agenda.

Newbold said: “It’s true that we haven’t communicated enough before about how we are tackling the most important environmental and social issues, and, as result, we recognise that it’s necessary to be more transparent, so that we can counter any misconceptions that still exist.

“We want to be as open as possible, by sharing a comprehensive, collective narrative on our sustainable expansion and future targets,” he added. “We are on an ever-evolving journey and this report represents our commitment to keeping stakeholders updated on our progress, now, and in the future.”

Efficient business model

Lidl has in many ways pioneered the sustainability movement in retail, adopting charges for plastic carriers bags in its first British stores in 1994, and becoming the first supermarket to adopt the living wage.

These commitments have been built upon in the German-based chain’s first CSR document. In the past year, Lidl has stopped selling single-use carrier bags across all UK stores, and phased out microbeads from its own-brand cosmetic and household products.

By 2017, LED upgrades have been carried out in 20% of UK stores, while 98% of waste has been diverted from landfill. The chain has also to committed to surplus food donation in the UK through social media platform Neighbourly.

Despite these significant achievements, there remains a widely-held perceived view in the industry that discount retail business models are not conducive to sustainability. Newbold said that one of the most important aims of the report is to challenge any such misconceptions.

“On the contrary, a business model such as ours, which is centred around efficiency and simplicity, enables us to work with a more consolidated supply base, whilst building flexibility and agility into our working practices,” he said. This is achieved through our global buying power and lean product ranges, which remain consistent at approximately 2,000 lines.

“This enables our dedicated buying teams, who manage all aspects of the trading relationship, to build closer and stronger relationships with our suppliers, whilst having a better and more comprehensive understanding of their business, and an appreciation of the challenges that they face.”

Expansion ambitions

One of the ways Lidl does this is by working with growers to align promotions with crop spikes to help avoid farm waste. The retailer is also aiming to reduce the waste created by its customers, with a vow to work alongside Wrap in 2018 to pilot new on-pack messaging.

It is clear, however, that a great deal of hard work still needs to be done. Lidl is a rapidly growing business, opening up to 60 stores a year. As such, it has seen an overall energy increase of 5% over the past 12 months.

To tackle this issue, the company is investing in more efficient technologies, such as glazed doors on the front of upright fridges for milk, meat and fish, which have resulted in energy savings of 30-40%.

Newbold said that a sustained move towards low-carbon, resource-efficient operations will help Lidl maintain business competitiveness as it continues to grow in the future.

“As a team, we are fully aware of the essential role that sustainability plays in supporting our expansion ambitions and delivering a strong discounter business.

“Within our new strategy we have set out strong, future commitments and targets to help customers lead healthier lives, reduce our impact on the planet and improve sourcing policies, which provide us with the foundations to lead and pioneer in these areas.”

George Ogleby

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