Survey: SMBs Going Green Regardless of ROI

The rise in popularity of “green” technology, which focuses on energy conservation and renewable energy sources, can be evidenced by the multitude of enterprise level technology vendors hawking their products and services as environmentally friendly—and cost-effective in the long run.

A survey by online payroll firm SurePayroll found three out of four small business owners have embraced green initiatives, from recycling to telecommuting, regardless of their ROI (return on investment).

Of businesses that consider themselves green, the majority (71 percent) said they choose to implement green practices simply because they want to be environmentally conscious, while the rest choose to do so to save money. Out of all the green businesses, half noticed an ROI of around 5 percent to 10 percent, while the other half have yet to see one. Yet, SurePayroll President Michael Alter said the lack of significant ROI has not deterred small businesses from implementing such practices.

"The biggest challenge for small business owners is typically cutting costs, so it's refreshing to see that most small business owners are going green simply for the good of the environment,” Alter said. “As the foundation of the economy, small businesses can do well to set an example for larger corporations and even homeowners."
The 25 percent of surveyed business owners who don’t consider themselves green, in fact are environmentally conscious at least in one aspect, Alter says; the mere fact that they use direct deposit. Annually, SurePayroll processes 75 percent of its customer payrolls through direct deposit – more than $3.75 billion in payroll payments.

A study by the 2009 PayItGreen Alliance, a nonprofit that represents 11,000 financial institutions, showed that if one U.S. employee paid bi-monthly used direct deposit, they would save one pound of paper per year, eliminate the release of four gallons of wastewater, eliminate the release of one pound of greenhouse gases and save a business approximately $176.

According to Alter, implementing company-wide direct deposit is often the first and easiest step to creating a significant positive impact for the environment. The Consumer Federation of America revealed in 2008 that 76 percent of employees who don’t have access to direct deposit say they would use it if they had the option.

"As an online payroll provider, we’ve always recognized the demand and necessity for direct deposit and are seeing more and more small business employees taking advantage of it,” Alter said. “It is becoming as much an issue of cutting down the amount of wasted paper and energy as it is convenience."

Even though some small businesses underestimate the environmental impact of switching to direct deposit, Alter said the majority still think any type of initiative is worthwhile. Small businesses help the environment by recycling (93 percent) using environmentally friendly office supplies (75 percent) and limiting use of electricity and other energy needs (68 percent).

On a broader scale, survey respondents indicated city-wide green projects are great for both the environment and the small business community, though they said they don’t know enough about what President Obama plans to do to tackle environmental issues. Small business owners are divided when it comes to deciding what environmental policy change would most benefit small business. The survey found the top concerns are investing in clean (green) technology to create more jobs and providing incentives for energy conservation to help reduce monthly energy bills.

"Even if their specific concerns vary, the fact that so many small business owners have taken a genuine interest in going green both locally and nationally is inspiring," Alter said. "It's another example of just how important small businesses are to the well-being of our country."