A 'green' makeover can improve your image and your profit margin

Robert J. Smith is senior engineer for Aspen Systems Corp. in Rockville, Md.

Restauranteurs typically keep 3 to 9 percent of their revenues as profit.

Suppose you could increase your profits by one-third by reducing operating costs without sacrificing the quality of service and increase customer satisfaction at the same time? Does that goal seem like pie-in-the-sky?

It may sound surprising, but it is an attainable goal. By simply increasing the energy efficiency of your operations, you can obtain these profit improvements. In investment terms, energy efficiency, or "green," upgrades can yield up to a 30percent return.

Even larger returns are possible from several side benefits of energy efficiency, such as: Publicity for your energy efficiency investment will attract customers who seek out green products and services; some lighting and air-conditioning efficiency upgrades can increase customer comfort and make customers want to return more often; and some lighting and air-conditioning efficiency upgrades can improve employee productivity as well as "affinity" with a green employer.

How do you start?

The best opportunities to improve energy efficiency occur when planning renovations or equipment replacement; however, good opportunities exist at any time. An energy survey can help you identify opportunities for efficiency upgrades. Those surveys are sometimes called "energy audits" or "energy assessments." An energy specialist will walk through your operation and identify cost-effective opportunities for improving energy efficiency. The survey carries no obligation. You will receive a report that identifies the opportunities and calculates the payback or number of months to recover your costs - for each efficiency upgrade identified. Your local utility company is the first place to call to request an energy survey. Many utilities offer subsidized assessments as a way to increase customer satisfaction and loyalty in this new age of deregulation.

You also can perform your own energy assessment. A free do-it-yourself assessment is available through the U.S. Environmental Protection Agency's voluntary ENERGY STAR Small Business Program.

Lighting upgrades

In addition to reducing lighting costs, the upgrades also can improve customer satisfaction. If you light your dining room or kitchen with standard fluorescent lighting and magnetic ballasts, replace them with T-8 fluorescent lamps with electronic ballasts. You can save up to $16 per lamp every year in electricity costs, and you will improve the color and quality of lighting for diners. If your exit signs use incandescent bulbs, replace them with a light-emitting-diode exit sign retrofit kits and you can save up to $22 per exit every year in electricity costs.

If you light your parking area with incandescent or obsolete mercury vapor lights, replace them with high-pressure sodium or metal halide lights and you can save up to $30 per light each year. You also will improve the lighting level and parking area safety. You can add photocells and timers for even more savings.

Heating and air-conditioning systems

If you have an oil or gas boiler or furnace that is ready for replacement. replace it with a high-efficiency unit and you can save up to $200 per year in energy costs. If you cool your dining area and kitchen with an old standard efficiency air-conditioning system. replace it with a high efficiency air-conditioning system and you can save up to $900 per year in energy costs. If your thermostats are set manually, installing a programmable thermostat with night setback can save you up to $300 per year.

Twenty thousand dollars can buy a lot of bread. That is what Subway franchisee Steve Kaplan is saving by taking advantage of energy-efficient technologies at his restaurant in Norman, Okla. Kaplan's recipe for success? He upgraded his store's lighting from 40-watt T-12 lamps and magnetic ballasts to T-8 lamps and electronic ballasts. The result is brighter lighting that makes the food look more appetizing in addition to a 50-percent energy savings. Kaplan replaced his old air-conditioning units with high-efficiency models and added ceiling fans to circulate the store's air. He now can set his thermostats 3 to 5 degrees higher in the summer without affecting comfort. The upgrades will pay back his investment in 3 years.

Ventilation systems

Ventilation systems offer additional ways to reduce energy costs through efficiency upgrades. Cooking is normally the largest component of a restaurant's energy bill. Replace your standard exhaust hoods with hoods optimized for your cooking needs, and you can save up to $2,000 per year on heating and air-conditioning costs.

Refrigeration

If you leave your walk-in refrigerator door open when you are loading, install a plastic strip curtain over the entrance and you can save up to $20 each year per refrigerator. If you have a refrigerator that needs to be replaced, replace it with a high-efficiency unit and you can save up to $100 per year.

When Rick Stein, owner of the Inn at Wiccoppee in Hopewell Junction, N.Y. ordered a free energy survey from his local utility, Central Hudson Gas and Electric, he never imagined he could convert energy costs into actual profits.

The energy survey recommended consolidating his five partially filled refrigerator units into two and disconnecting the remaining units.

The survey also recommended converting 11 standard fluorescent fixtures in the kitchen to T-8 lamps with electronic ballasts. Stein now is enjoying $1,869 per year in reduced energy bills with a payback on 0.6 years.

Dishwashers

If you have a dishwasher that is 10 to 20 years old, replace it with an insulated dishwasher and save up to $1,200 per year.

Green can attract diners

Kermit the frog is not the only one who likes green. Marketers have found that a show of green will bring some customers into a store who otherwise might go elsewhere. It can happen with restaurants also. Energy efficiency is a magnet, and advertising it can attract those extra customers who look for businesses that are concerned with energy efficiency and improving the environment. This can put some more "green" in your cash register.

One way to obtain the advertising benefits of your energy efficiency investments is offered by the EPA's ENERGY STAR Small Business initiative. This completely voluntary, no-cost program is not tied to any of the EPA's environmental compliance responsibilities. It offers assistance to small businesses that want to upgrade their energy efficiency. If you contact the EPA and subsequently upgrade your energy efficiency, you can receive a colorful window decal, poster and other PR materials that can help attract these green customers.

For information on how to get these PR materials or receive a free do-it-yourself energy survey kit, call 1-888 STAR YES or visit EPA's Web site at www.epa.gov/smallbiz.

COPYRIGHT 1999 Lebhar-Friedman, Inc.
COPYRIGHT 2000 Gale Group