Sustainability is more than just a trend—95% of small businesses say it’s important to the future of the economy. Whether you have a set budget or want to break new ground, you might wonder how to be part of the change.
Having a small business sustainability plan is essential to get organized and start working toward a more green business.
Sustainable businesses help decrease the impact on the environment by reducing carbon emissions, energy consumption, and waste. In turn, it reduces business costs, attracts investors, and builds a better image—helping to bring in new customers.
Want to start taking action? In this guide, you’ll learn how to create a small business sustainability plan and keep yourself on track with a sustainability plan template.
Step 1: Be in the know
The first step to creating a small business sustainability plan is learning about sustainability to understand how you can implement and improve your sustainability efforts.
You can learn about sustainability by:
- Researching sustainability topics
- Learning about how businesses affect the environment
- Finding out what other small businesses are doing to help
- Understanding the environmental, social, and governance (ESG) framework
- Grasping some sustainability business practices
You should also learn about the sustainability laws and regulations in your area and understand if you’re within the standards.
Remember that sustainability is a broad topic and there are many ways you can make your business more sustainable. Understanding sustainability helps you change your perspective and find ways your business can change and future-proof itself.
Step 2: Identify what you’re already doing well
Implementing a sustainability plan takes time and work, especially when it’s a new project on your plate. That’s why analyzing your current sustainability efforts can help you focus on what needs to improve—and where to take things one step further.
Start by doing an energy audit to check your business’s lighting and HVAC systems. Then, identify the internal and external actions you’re already taking.
Consider asking yourself these questions:
- Do you have a recycling program in place?
- Are you sourcing materials from a sustainable supplier?
- Do you have energy-efficient lighting?
- Are you partnering with local suppliers?
- Is your business fully digital?
- Do you use recyclable packaging?
There are many areas of your business that impact the environment. Understand what you’re doing well in your office and in the development of your products or services, customer service initiatives, and marketing.
Once you pinpoint what areas you’re doing well, you can create a priority list of things you need to do. If you already have some sustainability projects in place, consider if there’s still room for improvement.
Step 3: Find out what you have to improve
Now that you’ve assessed your sustainability efforts, you’ll have a better idea of what areas you need to improve. Do this by:
- Asking your employees if they have ideas of what to improve
- Looking at your business’s bills and finding what you can cut down
- Sending a survey to your customers
- Talking to friends or business owners in the same field
Note which areas you can improve and what needs the most attention. Then, look for areas where your business could contribute the most. Look at your energy audit to find out how you can cut down on energy consumption or see if your supplies could come from a more sustainable source.
Step 4: Search for opportunities
After identifying the areas to improve, start searching for more opportunities for implementing your sustainability plan. Set a goal for your sustainability plan so you can focus on the area that you can improve the most.
This is when your innovation and creativity come in. Try to find cheaper and better ways to help the environment and your business. Research new ways to manufacture your products or look for more sustainable shipping methods. Or get inspired by other small business owners starting sustainable movements.
Then evaluate whether you are able to implement these changes. Consider how long it will take, how much it will cost, and if there are any changes you can implement today.
Step 5: Create and implement a sustainability plan
Now your plan is coming to life. Write down all of the changes and improvements you want to make and divide them by the time and effort it will take to accomplish them.
Consider what you and your business are passionate about. Do you want to reduce your carbon footprint? Do you want to learn how to reduce waste? Do you want to provide greener products?
Choosing a main goal for your business sustainability plan can make implementing it easier. Once you pick the issues you want to focus on or areas you want to improve, you can start solving them.
Figure out how you will improve your sustainability efforts and assign tasks to yourself and your team. Create a checklist you can follow—even if it means taking baby steps. If you’re changing certain processes, communicate how these changes will affect your team and what they should expect
Creating a small business sustainability plan is just the first step. You have to follow it through and track your progress to see the real change. You can use a sustainability plan template to keep track of your sustainability efforts and progress.
Actionable sustainability ideas
There are many ways to make an impact with your business sustainability plan. Here are some actionable ideas to consider:
Go paperless
Strive to become a paperless business. Here are some of the many benefits to going paperless:
- It helps the environment and reduces carbon footprint.
- It’s more cost-effective by reducing operating costs.
- It can reduce clutter and protect important documents.
- It’s more accessible and may increase productivity.
So why not go digital? Switch your paycheck and bill management to digital, store important documents in the cloud, and keep all company materials online.
Start a sustainability committee
Many people are now passionate about sustainability, and you might even find them within your team. When creating a sustainability plan, you can start a sustainability committee to get your employees involved.
As a bonus, they can take charge of sustainability efforts, support other employees, and come up with new ideas for growing a sustainable business.
Build a recycling program
Recycling and sustainability go hand in hand, and creating a recycling program as part of your sustainability plan can make a big difference.
Start by finding a recycling program for your business and providing separate bins for paper, plastic, metal, glass, and organic materials. Then, inform your employees about the new recycling program through a short training session or an online guide.
Encourage sustainable transportation
It’s not breaking news that transportation has a big impact on the environment, so encourage your employees to adopt a cleaner commuting option or consider hybrid work.
Show the impact and cost of commuting with their own vehicle versus carpooling or public transportation.
To encourage employees to choose a sustainable transportation method, you can:
- Create a carpool rotation list for those who want to join.
- Install bike racks to encourage a cleaner means of transportation.
- Consider paying for public transportation.
- Adopt remote or hybrid work, if possible.
You also have to look beyond how your employees get to work. Consider how supplies and materials arrive at your company, too. For example, look for greener transportation companies that use electric or hybrid trucks.
Host a sustainability training
Sustainability is a team effort, and as we’ve all heard, there’s no “I” in “team.” You made the effort of learning about sustainability and how you can improve, so your team should have this knowledge as well.
Teach your employees about sustainability so they can all help make a bigger impact. You can host monthly training sessions on sustainability or consider a self-paced online course.
Decrease energy consumption
If your main goal is to reduce your carbon footprint, you should consider decreasing your energy consumption.
After conducting an energy audit, you may reduce your energy consumption by:
- Investing in energy-efficient lighting, like LEDs
- Installing programmable thermostats
- Upgrading to solar roofing
- Considering HVAC retrofits
- Purchasing energy-efficient appliances and equipment
- Making energy-efficient upgrades to your storefront
These upgrades can have a higher cost upfront, will help your business become more sustainable, and reduce your energy bills. A greener business means more green in your pocket.
Consider green packaging
From recycled to-go boxes to reusable straws—green packaging is here to stay.
Many businesses and customers value green packaging, so invest in sustainable packaging for your products. Some great options include:
- Recycled cardboard and packing paper
- Biodegradable air pillows and packing peanuts
- Corrugated bubble wrap
- Cornstarch and seaweed packaging
Consider how your supply chain strategy affects the environment and develop greener products. For example, you can cut down on the amount of plastic in your products.
You also want your employees to do their part. Encourage them to use reusable cups and containers, or provide recycled utensils for the office space.
Join a carbon offset program
If you don’t have a lot of time and resources to invest in a sustainable business plan, consider joining a carbon offset program.
Many businesses, no matter how small, require carbon emissions to run. A carbon offset is a way of balancing—or “canceling”—your emissions by investing in projects that help reduce carbon emissions.
Joining a carbon offset program helps you counteract your negative climate impact by purchasing carbon credits that help address climate change.
Small business, big impact
You don’t need a large budget to make a big impact. With a small business sustainability plan you can start making a change, even if one step at a time. Set up a recycling program, decrease your energy consumption, or go digital —it doesn’t matter where you start, the planet will thank you.
This article originally appeared on Quickbooks and was syndicated by MediaFeed.org.
How to automate your small business taxes
The taxability of a given product or service can vary from state to state, and in some cases, such as in Colorado, taxability can even vary from city to city. Location isn’t the only complication businesses face when calculating sales tax. Specific products and services can also have special or reduced rates and fees that need to be calculated at the point of sale
This is why mapping products and services to an appropriate tax category in any automated tax system are both very important and very powerful.
Sales tax is often complicated. Properly mapping products and services in your tax system will ensure that the correct taxability determination, accurate tax rate, and any applicable fees are being calculated for every sales transaction. (Curious how sales taxes affect your bottom line? Check out our sales tax calculator.)
The need for mapping products and services to tax categories is most apparent in these major areas:
DepositPhotos.com
In the US, four states provide general exemptions for clothing, three states provide an exemption as long as the clothing is under a certain dollar amount, and one state taxes luxury clothing at a higher rate. The definition of what qualifies as clothing (clothing accessories, work clothing, protective equipment, etc.) is not uniform from state to state, so an item may qualify for the clothing exemption in one state but not in another.
To further complicate the issue, in 2018 sixteen states had sales tax holidays that provided exemptions for certain articles of clothing for limited periods of time.
Looking at the states with clothing dollar amount thresholds, we see that Connecticut, Massachusetts, New York, and Rhode Island are all subject to different thresholds. The thresholds are $50, $175, $100, and $250, respectively.
These states not only differ in thresholds, but they may also differ in how purchases that are over each unique threshold are treated.
Massachusetts
Massachusetts has a 6.25% sales tax rate for the entire state. For clothing, only the amount over the $175 threshold is subject to sales tax.
- Sales Transaction A: $100 Blouse. No sales tax applies because blouse is under $175.
- Sales Transaction B: $200 Blouse. Sales tax applies only to the portion over the threshold; $25. $200 – $175 = $25 * 6.25% = $1.56 Sales Tax
New York
New York has an 8.875% sales tax rate in NYC and other rates vary depending on the location of sale. For clothing, the entire amount is taxable if the item is over the $110 threshold.
- Sales Transaction A: $100 Blouse. No sales tax applies because the blouse is under $110
- Sales Transaction B: $200 Blouse. Sales tax applies to the entire item price; $200. $200 * 8.875% = $17.75 Sales Tax
If the taxability of clothing seems complex, it gets even more complicated as you look at more and more states. For example, one article of clothing that costs $1200 would be subject to different thresholds Massachusetts, New York, and Rhode Island, as well as taxable at a special rate in Connecticut, while being fully taxable in some states and exempt in others. Clothing rules can be more problematic than you think.
This shouldn’t make you worry. Properly mapping your clothing products to the correct clothing tax category in an automated sales tax system will ensure that the proper taxability determination, rate, and threshold rules are applied across all taxing jurisdictions.
DepositPhotos.com
In 2018, seventeen states had sales tax holidays that exempted certain categories from state sales tax for limited periods of time. These categories included items like: back to school supplies, energy star appliances, and hurricane preparedness items.
Sixteen of these sales tax holidays exempted clothing. As a small business owner, you have to keep in mind that the sales tax holiday exemptions have similar intricacies as the year-round exemptions, including the definition of what qualifies as clothing for each holiday and how the thresholds vary from state to state.
For example, Alabama, Arkansas, Connecticut, Iowa, Maryland, Mississippi, Missouri, New Mexico, Oklahoma, Tennessee, Texas, and Virginia exempt clothing up to $100 during their sales tax holidays, while South Carolina has an unlimited exemption, Massachusetts exempts up to $2,500, and Ohio and Wisconsin exempt any clothing item under $75.
Your automated tax solution will automatically account for these sales tax holiday rules, as long as your products are set up correctly. In other words, in order for an exemption to properly calculate during a sales tax holiday, the item being sold must be properly mapped to the appropriate tax category.
DepositPhotos.com
The majority of US states impose special rules on food. Most states exempt food for home consumption from sales tax entirely. Arkansas, Illinois, Missouri, Tennessee, Utah, and Virginia have special reduced rates for food for home consumption. Arizona and Louisiana exempt food at the state level but tax it at the general rate at the local level (some exemptions/reduced rates apply).
While individual states are ultimately responsible for defining the exact scope of special sales tax rules related to food and beverages, food for home consumption is generally accepted to include staple grocery items and foods which are not prepared prior to purchase and are not meant to be consumed on-premises. Candy and soft drinks can be included or excluded in this definition, depending on the state.
Many states, including Member States of the Streamlined Sales Tax Agreement, exclude prepared food, dietary supplements, and alcoholic beverages from the definition of eligible food for home consumption.
Example: A liter of soda is fully taxable in Minnesota and Illinois, while fully exempt in Massachusetts.
Example 2: A loaf of bread is exempt in Minnesota, taxable at a reduced rate in Illinois, and exempt in Massachusetts.
Again, properly mapping food items to the correct tax category will ensure that the proper taxability decision and reduced or full rates are applied across all jurisdictions.
DepositPhotos.com
While most states provide an exemption for food for home consumption, food intended to be consumed on-site in places such as in a sit-down restaurant or when ordering take-out is generally taxable. Some states tax this type of food at the general rate, while others have special rates, called a Meals Tax.
Many local jurisdictions also impose a meals tax, even in states that have no other local taxes, such as Massachusetts or in states with no state sales tax, such as New Hampshire.
In an automated sales tax system, these rules will seamlessly be applied to your transactions once you have mapped all of your products and services accurately.
DepositPhotos.com
Medical products is another area where states enact special tax rules. Many states provide a sales tax exemption for prescription drugs. The definition of what qualifies as a prescription drug, just like clothing and food, can differ from state to state.
For example, some states such as Missouri, exclude over-the-counter prescription drugs from their exemption. Other states such as Texas, exempt all drugs, regardless if they are or are not given under a prescription.
Why mapping is important in this area is because some states have a very broad definition of what qualifies as a “drug.” States are also increasingly providing exemptions for other medical items, such as feminine hygiene products.
Properly mapping a medical product to the most specific tax category in your automated tax system will ensure that the proper taxability determination is being applied across all jurisdictions and that your customers are getting all of the exemptions that the states have to offer.
DepositPhotos.com
Products that are not exempt in any jurisdiction and are not covered by any sales tax holidays may still need to be mapped in your automated tax system to ensure not only a comprehensive collection of all relevant taxes but also of all applicable fees.
States may impose fees on items such as lead-acid batteries, tires, electronic items, bottled water, soda or alcohol containers, and E-911 charges.
Mapping to the proper tax category for these types of items will ensure that the proper taxability, as well as any applicable fees, are calculated by your automated system.
DepositPhotos.com
The treatment of software and related services differ significantly from state to state. Prewritten software provided in tangible format is taxable in every jurisdiction with a sales tax. The treatment of software transmitted electronically, on the other hand, varies from state to state and can vary for a variety of reasons, including whether the software is custom, prewritten, transferred with tangible personal property, or comes with upgrade, updates, or technical support services.
The treatment of Software as a Service (SaaS) and other software related services also varies widely from state to state.
Similar to clothing, food, and medical items, not only does the sales tax treatment differ for SaaS, but the definition of what qualifies as SaaS and other software related services differs by state. This is another reason why it is critical to pick the most specific tax category that matches the products your business sells.
Software-related services may also be subject to special rates, such as the 1% Connecticut rate for computer and data processing services, or in Texas, where data processing services are only taxable at 80% of the base.
Automated Tax systems provide a significant number of software and software services tax categories where the underlying taxability is maintained across all jurisdictions and helps your business ensure the proper calculation of rates and taxability.
DepositPhotos.com
Given the many variables and complexities around sales tax product and services categorizations, the solution is probably not DIY. When set up properly using a comprehensive software, you can take all of your compliance issues and turn them into an automated process that seamlessly and effortlessly calculates the right tax, at the right rate, for every transaction.
This article originally appeared on the Quickbooks Resource Center and was syndicated by MediaFeed.org.
DepositPhotos.com
Featured Image Credit: JLco – Julia Amaral/istockphoto.
