Responding to Regulation
City, county, and state governments continue to propose and enact green regulations. For retailers, it is important to remember that just as you are competing on in-store experience, product quality, price etc… you are competing on how well you respond to Regulation. Why? How well you respond will directly affect your customers and your financials.
A plastic bag ban—if not deftly handled by a store—can be a very unpleasant experience for a customer. Suddenly having to pay for a bag or multiple bags will be a burden; and whether or not that decision came from the store, the customer will associate the change with the store. Once a regulation has passed, it is now your responsibility to put it in place in a manner that reflects your corporate values.
Reevaluate your Current Policy: Any regulation is likely to affect the company in a variety of ways. If a plastic bag ban is passed, how does this affect your paper bags? Most likely, paper bags cost significantly more than plastic bags due to a variety of reasons from production to shipping; so your cost structure has changed. If you continue to offer paper bags for free, almost all of your bag demand will shift over to paper. Because of the regulation, your current policy—and not just the aspects being directly regulated—has changed. You need to reevaluate it in a new context.
Redesign the policy: Redesign the current policy in a way that fits with the new (regulation-changed) landscape. Based on the higher cost of paper bags, it may make sense to charge for paper bags, further incentivize reusable bags, or scrap paper bags altogether and further incentivize reusable bags. You have to redesign the current policy in a way that financially and qualitatively fits your culture.
Ease and Track Customer Reaction: Specifically with regulation, easing the customer transition is key. The way in which the regulation hits the customer is in your hands. In-store notices to customers about the upcoming change, reusable bag give-aways and countdowns to implementation will smooth the transition— and win over customers from competitors who may have misstepped. Throughout the process, from preparation to implementation, track the customer reaction so as to best fit your response.
By adapting to the regulation in a proactive way, you maintain control of customer experience and your financials; and gain or at least maintain stride with your competitors.
—Scott.L
