Small businesses are the backbone of the American economy. In Vermont, this holds especially true. Vermont has more than 75,000 small employers, comprising a staggering 96 percent of the companies in the state. With more than 157,000 workers, the small business sector accounts for nearly 60 percent of our state's total workforce.
In short, when small businesses succeed and thrive, it benefits all Vermonters.
Succeeding in small business requires persistence, flexibility, and energy. It also means managing to margins that are often razor thin by constantly seeking new ways to drive costs down without sacrificing service to customers or the ability to grow in the future. These are the big challenges that small businesses take on every single day.
This year, the third week of June marked National Small Business Week. Celebrations for this event presented a great opportunity to highlight how some Vermont small businesses are meeting these challenges. A top item on that list is managing energy costs through investments in energy efficiency. Energy efficiency saves money for businesses, and can offer additional benefits by improving the comfort and experience of employees and customers alike.
New LED and other high-efficiency lighting technologies, for example, offer the opportunity to customize lighting in ways that were not possible just a few years ago, while slashing electricity costs. LEDs can offer energy savings of more than 50% compared to CFLs, and 75% compared to incandescent lighting. They have very long lifespans which reduces maintenance hassles for businesses. Increasingly, Vermont retailers are adopting LEDs to display their products in the best light; grocery stores installing LEDs in refrigerator cases to minimize heat and reduce food spoilage; and office spaces are using controls that automatically dim overhead lights when the sun is shining in the windows. In all these cases, better use of energy is good for the bottom line.
Pete's Greens in Craftsbury, whose founder Pete Johnson was named this year's Vermont's "Small Business Person of the Year" by the Small Business Administration, is a company that exemplifies the drive to reduce energy waste. When confronted with the need to rebuild their facility from the ground up due to a devastating fire, they did their homework and worked with Efficiency Vermont. This meant designing a new space that minimized energy waste on all fronts: insulation that holds heat in the winter and keeps the building cooler in summer, and high efficiency refrigeration and lighting systems that will make the business much less vulnerable to energy price increases in the future. Reducing the amount of money being spent on wasted energy lets Pete's Greens focus more of their resources on meeting the needs of their customers and growing their business.
For Northshire Brewery in Bennington, taking steps to reduce energy usage made good business sense. They needed to get control of their energy costs, but like many small businesses, they did not have capital to spare. Working with Efficiency Vermont, they were able to take advantage of an innovative loan program to borrow the funds needed to make the investment in energy efficiency. The loan was structured so their payments were less than their energy savings. In other words, they made a needed investment in their business -- and they are paying less out of pocket every month from day one.
The benefits of reducing energy waste aren't limited to individual businesses. When Vermont's small businesses invest in energy efficiency, they don't just help their own bottom line, they support the bottom line of other local small businesses too. Energy efficiency improvements in Vermont are carried out by dozens of small businesses and sole proprietorships all around the state. By investing in energy efficiency instead of spending money on energy waste, Vermont small businesses help to support the local economy and keep more of our dollars in our local communities and available for local investment. It's a win-win scenario for our state: every dollar invested in energy efficiency generates five dollars in benefits for the economy.
Vermont businesses, including our small businesses, need every edge they can get to compete in a global economy that gets more competitive every day. Thousands of these small businesses in Vermont are doing the math and taking advantage of the savings that investing in energy efficiency can provide. Waste of any kind is bad for the bottom line: so now is the time to applaud all the Vermont businesses that are taking control of their energy usage, and planning for the long term.
Lawrence Miller is the secretary of the Agency of Commerce and Community Development. Jim Merriam is the director of Efficiency Vermont.