Wal-Mart wants eco ratings from its suppliers

Wal-Mart is the world’s largest retailer and with that title it has a lot of room to demand certain things from its suppliers. The retail giant is now demanding that suppliers measure the environmental cost of making their products so it can calculate and post an eco-rating for the items.

While it is quite an ambitious project, it will likely cause other retailers and companies to redesign products in the future to be more environmentally conscious. Those environmentally conscious shoppers won’t likely see the eco ratings on products for many years, but the fact that Wal-Mart is taking an initiative is likely to still stir the competition.

In the first phase of the program, Wal-Mart will give suppliers a 12 question quiz about things like water usage. There are currently 12 universities working to create this quiz and gather scientific data.

The move coincides with Congress talking about possibly putting environmental labels on items. However, getting Wal-Mart to do it before it even hits the floor would get it done in a much faster manner.

Retail industry consultant Burt P. Flickinger III said he applauds the program but worries how it will affect suppliers. New labeling and product redesign can increase a product’s cost by 1 percent to 3 percent, he said.

“Suppliers are going to have to absorb the cost increases,” he said.

Flickinger also said the new ratings will add value in environmentally conscious regions like California and New England. But shoppers in other areas who focus more keenly on low prices may not appreciate it as much.

Wal-Mart has been seen as a corporate bully in the past to get things done their way, and it hasn’t always been in the best interest of the consumer, but with the retailer looking to get suppliers to do this, then not only is is good for the consumer, but it’s good for the environment.

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