The Drivers and Barriers of Luxury Sector Retailers to Adopt Energy Efficiency Technologies in Hong Kong

Abstract

In recent years, many fashion brands and retailers have been under pressure to achieve environment-friendly production and operations. To reduce carbon footprints, retailers are seeking ways to adopt energy efficiency technologies (EETs), to have better control of energy consumption through technology improvement or substitution. The application of EETs has been researched in developed countries, such as the European Union and the USA, in areas of public and mainly manufacturing sectors. Some large-scale general merchandise retailers, like Walmart, are also widely reported for their adoption of adopting ISO 14001 environment management system, and ISO 50001 energy management system, and many EETs. However, it is not clear how EETs are being implemented in luxury retailers, which tend to be smaller in size located in major metropolitan cities. The energy efficiency of retail shops in major fashion cities, such as New York, London, Paris, and Hong Kong (HK) is largely neglected in the literature. To explore how luxury sector retailers in major cities implement EET, we selected HK as our research context. HK, being one of the largest and competitive luxurious product markets (HK's all retail sales in 2016 was US$56 billion of which luxury products amounted about US$10 billion), has long been suffered from light pollution due to the spot lights on large billboards on buildings, and the window display of brick and mortar stores on the street. The lightings are always on that also brings serious concern on energy consumption. This chapter shall review the application of EETs, such as renewable energy technologies, sophisticated lighting devices, battery technologies, energy-saving devices, and smart energy management, in the luxury sector retail industry of HK. In this paper, we reviewed both drivers and barriers of the application of EETs in the HK's luxury retail sector. The discussions are based upon interviews of renowned luxury goods retail chain stores in HK. Six luxury and premium brands (i.e., jewelry, luxury watches, fashion) retail chain stores are chosen, and in-depth interviews were conducted with their senior managements, who are responsible for the decisions of EETs adoption (if any). The samples include both private and publicly listed companies, and their number of stores range from 5 to thousands retail outlets in HK and China. We believe the findings could be applied into other retailers in luxury sectors. A conceptual model, Energy Sustainability Strategy Model on EETs adoption, is also proposed.