Sustainability in retail: Trends, challenges and best practices
The retail industry stands at a pivotal moment in its sustainability journey. With 85% of surveyed executives reporting higher investments in sustainability programs, according to Deloitte’s 2024 CxO Sustainability Report, retailers are moving beyond token environmental gestures toward meaningful operational changes.
From reimagining supply chains to embracing digital transformation, the industry is discovering that environmental responsibility and business success can go hand in hand. This shift isn't just about meeting regulations or appeasing stakeholders — it's about fundamentally rethinking how retail can thrive in a world where sustainability has become a business imperative.
Read on as we explore how retailers are transforming their operations through supply chain optimization, reselling initiatives, regulatory compliance and digital innovation.
Today’s retail sustainability landscape
Retailers have seen rapid shifts in consumer preferences, regulatory requirements and industry standards around sustainability. Deloitte’s report offers a useful window into the mindset of executives who are steering these shifts. The report surveyed over 2,100 global leaders and found that a majority now expect climate change to significantly affect their business strategies in the next three years. Many are pursuing sustainability measures in response to rising stakeholder pressure, new policies and evolving market demands.
Deloitte’s research indicates a notable increase in spending on sustainability programs. The vast majority (85%) of respondents report higher investments in sustainability over the past year. This upswing suggests that more leaders see a direct relationship between business resilience and climate action. In retail, these moves appear in the form of greener packaging, reduced energy use in storefronts and warehouses, and expanded product lines that meet lower-emission criteria. Executives are looking for ways to optimize operations, drive innovation and connect with consumers who express growing interest in environmentally responsible choices.
The Deloitte study also points to several factors that either accelerate or slow down sustainability progress. On one hand, the rapid expansion of clean energy and new climate-friendly technologies creates opportunities for retailers to differentiate themselves. On the other hand, complex supply chains and uneven political support make long-term planning more difficult. This balancing act requires retailers to reimagine their business models. Some have begun to treat sustainability as a business engine that lowers risk and improves customer loyalty. Others still view it as a set of incremental changes for compliance and public image.
Existing sustainability challenges
Retailers who aim to anchor their strategy on climate action often face a range of challenges. One involves supply chain transparency. Many retail businesses rely on global networks of suppliers with varied environmental standards, data systems and resource footprints. Tracing the origin of goods and measuring emissions at each stage can seem daunting. Without clear visibility into carbon impacts, retailers find it hard to identify the most effective interventions or hold partners accountable. However, larger brands are starting to work with suppliers to embed sustainability criteria in contracts, track metrics more precisely and reduce waste across the value chain.
Another challenge revolves around cost pressures. Energy-efficient equipment, low-impact materials and logistics upgrades carry initial expenses. Smaller retailers sometimes struggle to justify these upfront costs when profit margins are narrow. Yet, those who proceed see financial benefits in the form of reduced waste, lower utility bills and a stronger brand reputation. Many executives in the Deloitte report note that revenue and sustainability can move in tandem. For instance, a store that replaces single-use packaging with reusable alternatives can cut costs over time while appealing to eco-conscious shoppers.
Regulatory environments also add complexity. Different regions adopt varied emissions rules, reporting mandates and incentives for green investments. Retailers operating across state or national lines must keep track of multiple frameworks. A company that fails to comply risks fines, reputational damage or supply disruptions. On the flip side, those that meet or exceed standards may gain access to incentives, rebates or more favorable lending terms. This patchwork of regulations can drive innovation but demands consistent monitoring and agile responses.
Digital transformation is another piece of the puzzle — a challenge with a world of upside. Retailers rely on data to forecast sales, manage inventory and understand consumer behavior. They can apply the same digital tools to measure sustainability performance, automate reporting, and anticipate risks tied to climate impacts. Real-time dashboards, AI-driven analytics and connected devices help retailers spot inefficiencies and set improvement targets. In some cases, companies share this data with consumers to reinforce transparency around products and practices.
Deloitte’s 2024 report suggests that retailers who bring sustainability into core operations stand to gain revenue opportunities, stronger stakeholder trust and better long-term risk management. The sector’s supply chains, store operations and customer engagement channels carry untapped potential for climate action. As more retailers move beyond small steps and adopt bigger commitments, the collective impact on the environment and on business performance may become a significant force in the global marketplace.
Drivers of retail sustainability
Retailers respond to a range of forces that shape their decisions about sustainability. These forces come from government actions, new technology and shifting consumer attitudes — pushing the sector to balance profitability with environmental goals.
Supply chain optimization
Retailers often start their sustainability efforts by examining their supply chains, a critical aspect of retail sustainability. They map out each link in the chain, from raw materials to final delivery, and look for ways to use fewer resources. Many rely on technology — such as inventory tracking platforms and data analytics — to spot inefficiencies and adapt quickly. A small change, like reducing packaging layers or introducing more sustainable packaging, can lower costs while shrinking the carbon footprint.
Suppliers also play a large part in how a retailer approaches sustainability. Some retailers assess their partners on metrics that go beyond price and quality — they look at factory energy use, water consumption and waste management. This assessment process encourages suppliers to raise their standards. Retailers might even share training or technology with suppliers to help them move toward greener operations. In return, they gain consistent product quality and a more stable, sustainable supply chain.
Transportation choices add another layer of complexity. Goods travel long distances before they reach store shelves, and shipping can generate a sizable share of a retailer’s carbon emissions. Some companies adjust their freight routes, use fuel-efficient vehicles or mix rail and sea transport where possible. They pair these changes with route optimization software to limit empty miles and reduce transit times. As a result, they cut shipping costs while improving lead times.
Warehousing follows a similar pattern. Temperature control, lighting and equipment affect both expenses and sustainability targets. Upgrades to LED lights, motion sensors, or renewable energy systems trim energy bills and appeal to consumers who favor environmentally conscious retail brands. A growing number of retail facilities also adopt circular practices, repurposing or recycling unsold inventory. These strategies avoid landfills and support waste reduction efforts by retrieving economic value from returned or damaged goods.
Some retailers combine these tactics with transparent reporting. They release sustainability data or set emissions-reduction goals for each step in the supply chain. This practice signals accountability and builds trust among consumers and investors. Although data collection can be challenging, ongoing technological advances make it easier to track, analyze and act on sustainability metrics.
When done well, supply chain optimization leads to cost savings, better supplier relationships and reduced environmental impact. It serves as a strong platform for retailers who want to go beyond short-term measures and integrate sustainability into core business functions, ultimately meeting growing consumer demand for eco-friendly and responsibly sourced products.
Reselling
Reselling has become a rising force in sustainable retail, driven by consumers who prefer secondhand or refurbished goods. Retailers tap into this trend by creating online marketplaces, partnering with consignment services or running in-store buyback programs. These approaches turn used items into a revenue source rather than waste, contributing to ongoing waste reduction efforts. They also appeal to a broad range of shoppers, from budget-conscious students to affluent buyers looking for unique finds.
This model often revolves around product longevity, which directly supports retail sustainability. Some retailers design goods for easy repair or upgrade, prolonging their life cycles and reducing their environmental impact. Others share how customers can maintain products, offering guidance on cleaning and storage. By encouraging reuse, retailers generate goodwill and reduce the volume of items headed for landfills. They might partner with specialized repair services to set up a small repair station in-store or offer mail-in options for customers. This arrangement helps shoppers keep their items in use, aligning with broader sustainability goals.
Fashion retailers, in particular, have embraced reselling because it aligns well with fast-changing consumer tastes while supporting sustainable retail practices. Companies set up digital platforms where people can trade or sell items. They sometimes authenticate products to ensure quality and protect the brand’s reputation. This practice reassures buyers who worry about receiving counterfeit goods. It also brings customers back to the brand, since sellers often spend their earnings on new items, reinforcing a more circular retail business model.
Electronics retailers apply reselling models by refurbishing gadgets and reselling them at lower prices. This approach opens up technology to more buyers and saves a working device from the scrap pile, lowering overall waste. Some electronics stores offer trade-in programs, giving customers store credit for their used devices. They test, clean and repackage these gadgets for sale, conserving resources that would go into manufacturing new products. Meanwhile, buyers get a reliable device at a discount and help reduce the environmental footprint of e-waste.
Reselling does come with hurdles. Companies must handle quality control, manage returns and store inventory of varying conditions. They also need clear processes for grading or repairing items to set accurate prices. Shipping costs can become an issue if they move a single item multiple times before it reaches a final buyer. However, many retailers find that technology solutions — such as centralized inventory management or AI-driven pricing — smooth out these challenges. Overall, reselling stands out as a powerful sustainability initiative within the retail sector, balancing profits with environmental responsibility.
Regulations
Regulations shape how retailers integrate sustainability into everyday operations. Federal, state and local authorities often establish rules related to emissions, packaging, and waste disposal. For retailers with multiple locations or cross-border e-commerce platforms, these rules create extra hurdles. Some businesses set up compliance teams or bring in external advisors to manage these varied requirements. Others take a broader approach, meeting or surpassing standard compliance so they can skip rushed upgrades later.
This approach helps retailers stay ready for shifting laws, which can tighten at any time. A retailer that already monitors energy use and greenhouse gas emissions adapts more easily to new mandates than one without the right systems. Beyond enforcement, regulators sometimes offer incentives to adopt greener methods. Tax credits, grants and favorable loans can offset initial costs for retailers that want to install cleaner technology or reduce waste. Some governments even partner with private firms on pilot projects that test methods to lower emissions in stores or warehouses.
Compliance isn’t just about checking boxes. Reporting standards have become more prominent, and some regulators want detailed data on emissions, water use or labor conditions. Many retailers turn to standard frameworks — like the Global Reporting Initiative (GRI) or the Sustainability Accounting Standards Board (SASB) — to ensure their data is consistent and comparable. Publishing those metrics builds confidence with consumers, investors, and partners. However, collecting and verifying data takes time and technical know-how, especially when suppliers operate worldwide.
While some retailers see regulations as limits, others view them as chances to shape the conversation. Businesses can join industry alliances that work with lawmakers to create realistic rules. By sharing real-world experiences, they help policymakers understand how certain mandates affect smaller retailers or specialized segments. This dialogue often leads to regulations that address climate goals and take business constraints into account.
Falling behind can result in fines, lawsuits or reputational damage. Retailers often use this risk as motivation to stay aware of changing laws and spot potential gaps in their operations. They train staff, adjust processes and set up data systems that flag compliance issues before they become major concerns. This proactive stance prevents last-minute fixes and gives businesses a stronger position in a competitive marketplace.
Regulations continue to shift, and retailers that build flexibility and transparency into their practices can respond swiftly. Over time, they may even discover that meeting or exceeding regulations puts them ahead in a marketplace that increasingly rewards sustainable brands.
Digital transformation
Retailers rely on technology to strengthen sustainability efforts and measure performance. At a basic level, they use software to gather data on energy use, inventory, and logistics. This data often reveals hidden waste and opportunities to cut emissions. Automated tracking also replaces manual tasks, giving employees time to focus on strategy and innovation.
Digital tools bring new ways to engage customers. Some retailers share details about sourcing or carbon footprints through mobile apps or barcodes on product packaging. Shoppers scan the code, learn about the item’s origins and make more informed purchases. Retailers sometimes invite user-generated content, such as repair tips, to encourage a sense of community and reduce product turnover.
Artificial intelligence (AI) has gained traction in many retail operations. Machine learning algorithms predict demand, manage prices and streamline inventory to avoid overproduction. In logistics, AI steers vehicles along efficient routes, cutting travel time and fuel consumption. These algorithms evolve with each data update, which aligns well with retail’s fast-paced environment.
Retailers also explore digital receipts and paperless processes. Instead of printing receipts, they email or text them, which reduces paper waste and often benefits loyalty programs. Payment data feeds into analytics tools that reveal buying patterns or trends. Some retailers connect self-checkout kiosks or in-store tablets to these systems, gathering feedback while speeding up transactions.
Online platforms have sparked a rise in resale. Rather than discarding used or returned goods, retailers resell them through digital channels. Software solutions handle listings, manage payments and automate shipping. This method extends a product’s life and generates additional revenue. It also keeps products out of landfills and connects with shoppers who seek budget-friendly or eco-friendly options.
Digital transformation does create challenges. Retailers that manage vast amounts of data must protect customer privacy and guard against cyber threats. Many set up data protection protocols or hire auditors to confirm their security measures. Despite these concerns, the potential upside remains large. Retailers that adopt technology to track, analyze and communicate sustainability progress can identify new methods to reduce waste, lower costs and meet consumer demands.
Go paperless, with Sekure
One of the simplest ways to boost sustainability in your retail operations is to go paperless. Switching to digital receipts helps reduce waste, cuts costs and limits exposure to BPA- or BPS-laden thermal paper.
Plus, digital receipts won’t fade and are easier to manage — allowing you to track consumer behavior and launch targeted marketing campaigns.
Through Sekure’s partnerships, merchants gain affordable, user-friendly solutions that make it easy to offer paperless transactions. It’s a win for customer health, the environment, and your bottom line. By going digital, you’ll modernize your checkout process and create a better experience for everyone involved.
Learn more about our retail POS solutions.
