Nau and Again. Part Two of our Interview
Our interview continues, with the team at Nau, a new outdoor apparel company, chasing the goals of beauty, performance and sustainability. Today we delve more into their business practices. Visit here for the first installment, where Ian Yolles, with insight from the rest of the Nau crew, provided in-depth answers on the company's products and materials.
TreeHugger: What motivated Eric Reynolds (who over 30 years ago, co-founded Marmot, one of the first outdoor companies to use Gore-tex) to start up another company in the already crowded outdoor industry, particularly one that needs to jump through so many self imposed hoops?
Nau: The motivation stemmed from a genuine desire to do things differently and, hopefully in the process, inspire others to think and act in similar ways. Eric and the founding team knew that if our aspiration was to simply create yet another genre of performance-oriented outdoor product, we might as well pack up our bags and go home. The world doesn't need another traditional outdoor company, but perhaps the world does need ...... a company that's thinking a bit differently about the nature of its relationships with its customers and its larger responsibilities as a business.
TH: In the early to mid 90's outdoor companies were tripping over themselves to be seen to be green. And then they just seem to lose interest. Is the current enthusiasm for sustainable design different to that period? In what way?
Nau: Today consumers have a greater awareness of sustainability and a deeper understanding of the potential impacts of products. Â
In the early 90s, companies were making environmentally preferable products that didn't perform well, were lower quality or compromised on the aesthetics. Today, people don't have to compromise. They can have it all - sustainability, performance and beauty.
We also believe that the current interest in sustainable design is not just a passing trend but an indication of a much broader cultural shift. There is a lot of data to support this observation but one interesting example is GE, one of the largest companies on the planet. Earlier this year Jeff Immelt, the CEO of GE, announced a new strategic commitment that goes under the banner of Ecoimagination. In short it's a new commitment to find imaginative solutions to some of the worlds most pressing environmental challenges. In their words it's about next generation technology that is both ecologically and environmentally sound. The interesting point is that Immelt went out of his way to say they weren't doing this just to feel good but because it represented a huge market and customer oriented opportunity.
Nau: We respect what those companies have done. They have been leaders and inspired the entire industry and us. What we've attempted to do is incorporate sustainable business practices into all of our products, practices and partnerships from the outset. We believe our market positioning and the profile of our anticipated customers sets us apart - we are not after the same outdoor segment. We're setting out to integrate performance, sustainability and beauty in everything we do. As a result, our product point of view and customer segment is different then traditional outdoor companies. Â Â
Our 5% giving program connects customers with social and environmental organizations and differentiates us both through the level of giving and through the direct participation of our customers in the giving decisions.
Finally, Nau is also a company that from its absolute genesis point has aspired to design the entire enterprise from the ground up with the idea and ideal of sustainability at the center of the venture. Rather then having to retrofit anything or redesign any existing legacy systems, we've tried to be as intentional as possible with all of the decisions we've made to ensure we're doing the right thing. In that sense, the entire journey has been a fascinating exercise in design.Â
TH: You're planning a number of retail outlets, called Webfronts, designed not so much for onsite purchases, but more for customers to get touchy-feely with the clothes, earning a10% discount if their selections are shipped direct to their homes, instead of taking them then and there. Have you carried out any life cycle assessments (LCA's) on this concept to show it really does reduce environmental costs?
Nau: We are engaging with our logistics providers to track the magnitude of our green house gas emissions (carbon footprint) that result from shipping our products and to make continual improvements and efficiencies in the supply chain in order to reduce our greenhouse gas emissions. Nau has joined the Environmental Protection Agency's (EPA) "SmartWay Transport Partnership" Program, a voluntary partnership between EPA and businesses aimed at reducing fuel consumption as well as greenhouse gases and other air emissions.
Offering customers the option to ship their purchase to their home directly and encouraging them to utilize free ground shipping from our centralized distribution center alleviates the need for shipping mass amounts of product and storing extensive back stock in our Webfront stores. With small stockrooms, our stores will have less square footage, making them more efficient and requiring less energy to operate. Furthermore, with our model, at season's end, less stock will be shipped back to our distribution center reducing fossil fuel consumption, solid waste from packaging and emissions required to move that product around.
Moreover, we'll ship our customers' purchases in compact bags that use recycled content (50% post-consumer materials). We made this decision based on the results of a study commissioned by the Oregon Department of Environmental Quality and the U.S. EPA. The study analyzed over 20 packaging options and found that shipping items in bags resulted in the smallest environmental impact, including lower consumption of fossil fuels, less solid waste, and lower emissions.Â Corrugated boxes were found to have a much larger impact.
We've chosen UPS, a founding member of the "SmartWay Transport Partnership" program, as our shipping partner.Â UPS has achieved the highest environmental ranking possible from the "Smartway Transport Partnership" program.Â
A 10% savings will be offered if you choose to order a product in our store environment, via a self service interactive touchscreen device, and have it shipped to you from our centralized warehouse facility. We'll also offer free ground transportation to ship the product to you. The reason we're offering the 10% savings if you choose the "ship to you" option is that overall it's a more efficient process and we're choosing to share those savings with our customer.
TH: Is Nau going carbon neutral? If so, to what degree?
Nau: See Webfronts answer [above] regarding the work we are doing to reduce our emissions.
We are also committed to an offset program and are currently evaluating partners to provide carbon offsets for the emissions associated with shipping our products from the factories to the distribution center and from the distribution center to our stores and our customers' homes.Â We will also be purchasing Green-e certified renewable energy for our retail stores. We are looking at a variety of options and will most likely source Green-E certified wind and solar energy.Â Â
TH: We assume the garments will be made 'offshore.' How is Nau ensuring that the workers in the "cut, make and sew" end of your supply chain are justly treated?
Nau: Your assumption is correct. To produce the Nau collection, we've partnered with factories in Thailand, Canada, Portugal, China, Turkey and Hong Kong, and have in place a Code of Conduct with which all of our partners must comply. This Code of Conduct focuses on three key areas: human rights, environmental practices and issues of transparency and reporting. In developing our Code of Conduct, we did extensive benchmarking of industry best practices and incorporated relevant learnings into our final Code of Conduct.
Additionally, each of our partners must comply with applicable environmental laws of their country, and we encourage them to have a written environmental policy and implement a system to minimize or eliminate negative impacts on the environment. Â
To ensure that all of these requirements are being met, our partners must maintain on file all documentation necessary to demonstrate compliance with our Code of Conduct and required laws; agree to make documents available to Nau or its designated monitor; and agree to submit to inspections with or without prior notice. Â
In addition, Nau has partnered with VeritÃ©, an independent, non-profit auditing and research organization, to help ensure all of these requirements are being met. The mission of VeritÃ© is to ensure that people worldwide work under safe, fair and legal working conditions.Â If VeritÃ© auditors identify human rights, environmental, or health and safety violations in the workplace, we will together develop concrete steps to correct them through a combination of trainings for management and workers, education programs and remediation programs. Â Â
Nau's engagement with VeritÃ© includes risk assessments and management action planning sessions with the factories. The risk assessments are based on comprehensive factory evaluation methodology and include worker interviews supplemented with information gathered from management, documentation review and an environment, health and safety walk-through. The risk assessment is followed up with management action planning sessions with the factories' personnel to develop systems, solutions and time-based next steps to ensure continual improvement.
TH: Has the focus on sustainable and ethically production added cost to the product, compared to your less green competitors? If so, how do you expect your customer base will accommodate this pricing difference?
Nau: We have developed high performance and top quality materials with socially and environmentally sustainable attributes.Â The cost is associated with the level of quality, performance and durability of the products.Â We are building durable products with classic styles intended to have a long life.Â The idea is that you won't have to replace them as often, which is better for the environment and saves you money over the long run.
On average sustainable materials are more expensive than non-sustainable materials and fabric costs accounts for 70% of the total product cost. In order to promote sustainability we have made the commitment to share these new materials with other apparel companies.Â Our hope is that as these materials become more widely used in the industry the price will come down.
Given we're operating as a retail direct business, we have inherent margin advantages versus the traditional wholesale model. That enables us to invest in the product, particularly from a sustainability perspective, while at the same time ensuring that the cost of the product remains competitive. Our product pricing will be competitive with all of the upper end outdoor brands.
TH: Is there a launch date TreeHugger readers should look out for?
Nau: We started with our blog, The Thought Kitchen, which went live in August. On November 1 we launched our website. In mid January we'll begin selling product on line at nau.com and we intend to open three or fours stores in the March/April timeframe.
TH: If the Nau model works for outdoor apparel, is there a vision that outdoor equipment might also receive some of the same treatment?
Nau: We're very committed to taking this one step at a time. We still have a lot of work to do before we know we have a successful model and approach. In that sense we're very focused on getting the apparel product right and all of the other associated elements of our business. Assuming we are successful, then and only then will we consider other product extension opportunities. At the same time, we believe there is a good bit of our model that is replicable and genuinely hope that others will work to apply sustainability and corporate responsibility criteria to their own companies and products, outdoor equipment included.
A huge big thanks from TreeHugger to the team at Nau, for taking the time to provide such comprehensive answers to our questions. We think their responses provide a solid insight into the methodology of a green start-up company. We wish Nau well, and likewise to all that might follow their lead.
PS: we didn't cover it in the interview but the Nau headquarters is also a LEED (Leadership in Energy and Environmental Design) Gold certified building that uses materials like bamboo and recycled timber coupled with passive ventilation. The Webfront shops will employ the like of FSC (Forest Stewardship Council certified medium density fibreboard and recycled wine barrels. Nau is a Maori word, pronounced "now" and translates as "welcome." ::Nau