“People don’t buy sustainable products,” said Allbirds co-CEO Tim Brown. “They buy great products.” The company’s goal is to prove that its products can be both.
By the end of the decade, the San Francisco-based shoe brand aims to reduce the average carbon footprint of its shoes to near zero, reducing emissions even as it grows.
It’s not there yet. Last year, the company reduced the average footprint of each product by 12%, but its overall carbon emissions have increased by nearly 50% as the business has grown, according to an impact update. published on Friday.
This year, Allbirds plans to further reduce its average product footprint by 6%, but it said those additional reductions are expected to become more substantial from 2023 as ongoing efforts to shift the materials it uses begin to wear off. their fruits. By 2025, the company said it plans to start decoupling growth from impact.
“We have to bend the line,” Brown said. “The next few years are really critical.”
But redesigning products costs money, and the company’s ambitions come up against an increasingly difficult economic landscape, as rising inflation and an uncertain economic outlook dampen consumer spending.
Allbirds’ share price has fallen nearly 90% since its IPO in November last year amid a market sell-off. In August, the company downgraded its outlook for the year and announced cost-cutting measures, including an 8% workforce reduction.
“It’s been a tough time for sure, and the absolute worst conclusion of the last 12 months is that the goal doesn’t matter,” Brown said. “But for companies that crack the code here, there’s a huge reward for consumers and finances.”
Reducing emissions and reducing costs are not mutually exclusive, according to Allbirds. Among the measures he outlined in August are efforts to transition to automated fulfillment centers in the United States and to accelerate efforts to reduce logistics and product costs.
“We have to break the myth that sustainability always costs more,” said Hana Kajimura, sustainability manager at Allbirds. “Sometimes it is, if you’re going to invest in new materials, but…shipping or using less material, being more efficient, minimizing waste, [these things] to save money.”
As the company seeks to accelerate its ambitions in the years to come, it may prove more difficult to find the balance between expenditure and impact.
The reduction in the company’s average product footprint last year relied almost entirely on a slight increase in the number of products shipped by sea rather than by air, an effort to move most of the company’s operations towards renewables and a program to purchase renewable energy credits to essentially offset the impact of manufacturing.
These moves were “low hanging fruit, the things we could do immediately,” Kajimura said. This year’s 6% goal is based on dozens of different projects intended to gradually reduce the company’s footprint in areas ranging from packaging to logistics.
Going forward, he expects to start benefiting from a long-term effort to shift his wool supply chain toward regenerative practices, but he also faces thorny challenges like finding natural materials. that work just as well as synthetic shoe components and work with suppliers to really decarbonize the supply chain.
“It’s becoming increasingly clear that the work we need to do is to try to make ourselves bigger and change whole systems, whether that’s [through] working on policies or teaming up with other companies that are much bigger than us,” Kajimura said.