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Going green may have helped many businesses weather the Great Recession, new research shows.
A study by Green America, EcoVentures International and the Association for Enterprise Opportunity found that three-quarters of small businesses saw sales of green products and services increase over the course of the recent economic downturn.
As part of the study, researchers segmented the businesses into three groups based on the environmentally friendly attributes of their products and services, and their level of adoption of specific actions intended to make more efficient use of water, energy and/or waste.
They found that the greener the company was, the more likely it was to report increased sales. Specifically, the "deep green" group reported stronger performance compared to their "light green" peers on nearly every dimension tested.
"The market is clearly demonstrating its preference for sustainable business practices," said Lauren Frederic, program manager for EcoVentures International, an organization dedicated to sustainable development. "This is evident by the rapid growth of industry green segments, from green cleaning to socially responsible investing, which are systematically seizing market share from the conventional economy."
The research shows the market for green products and services has expanded dramatically over the past 10 years. Examples include the green building market, which has increased by 1,700 percent compared with the conventional building market, which contracted by 17 percent. Additionally, the organic-food market has increased by 238 percent compared with the nonorganic food market, which expanded just 33 percent.
"We believe that the market preference reported by the small businesses in this study is just the tipping point," said Russ Gaskin, chief business officer at Green America, a nonprofit organization that promotes environmental sustainability."Sustainability is clearly becoming a competitive imperative in business."
The study found that nearly 80 percent of small businesses believe offering green products and services gave them a competitive advantage, with three-quarters planning to expand their portfolio of green products and service offerings.
The study was based on surveys of 1,305 small businesses.