Whitespace of the Month
Chris King has launched the first 100% recyclable wheelset for road bikes, the ARD44. I've long respected the care and attention that the team at Chris King puts into their products. They're well known for the highest quality products that are generally ahead of their time. The cycling industry has a dirty history of shipping products that can't be recycled and ends up in landfills. I applaud their efforts to make sustainable products.
It's estimated that there are more than 2 Billion bicycles in the world and 100 Million more are sold annually. That's a lot of wheels Toni and it's a lot of new raw materials being mined for no other reason than industry inertia, laziness and inefficiency.
As more governments adopt strict Cradle to Grave (CtG) legislation, it's creating a giant whitespace opportunity to create and market the sustainable choice in many product categories. There's nothing new about consumers voting with their dollars to buy sustainable products but the number of choices is few and often far between. Chris King has cherry picked a $3,000 product that offers strong margins.
Many other companies will figure out that they can offer sustainable products at market clearing prices and still earn strong margins. In some categories, there sustainable materials actually lower COGS and enable better gross margins (think Reef flip flops and other consumer goods where the sustainable materials replace large unsustainable components).
I'm not aware of any company that is truly ready for all of the financial and operational impacts of the implementation of Cradle to Grave legislation. Select companies like Apple have started taking their products back at the end of their useful life but it's on a voluntary basis. What no company has admitted yet is that the strictest forms of CtG legislation could a) eliminate all profitability from unsustainable product categories b) lead to higher prices for unsustainable products c) result in the elimination of unsustainable products and d) create massive disruption in almost every product category. The impact of CtG legislation on public companies could be severe which makes the lack of foresight and proactive actions by many in the Fortune 1000 confounding. Lego has a good start which you can see here.
That said, I believe that we are at a moment where generational companies will be built off of the back of sustainable products disrupting incumbent unsustainable products. Here are some product categories that I expect will be among the next wave offering sustainable choices:
Sunglasses > Plant Based Plastics and Recycled Lenses. Ray-Ban offers 9 models of sunglasses with bio-acetate, bio-nylon or bio-rubber frames that are 28-57% bio-based. Yes, there are bio-based Wayfarers.
Car Tires > Bio-Plastics, Bio Adhesives and 3D Printing. Goodyear has released a prototype of a new tire model that uses 90% sustainable materials using soybean oil, rice husk waste silica and recycled steel.
Running Shoes > Recycled Plastic Bottles. Adidas has been a pioneer in pushing the boundaries of material science to clean up their products. They offer > 12 models of shoes using Parley Ocean Plastic and other sustainable materials.
Toys > Plant Based Plastics and Bio-Adhesives. Lego has made aggressive pledges to remove all forever plastic from their products and replace it with plant based plastics. Yes, the sustainable pieces will be just as easy to lose as the forever plastic ones.
Few of the products listed above are 100% sustainable. I'm the first to say that this isn't perfect but it's a good start. Conventional wisdom is that pioneers go home with arrows in their back. This is an opportunity for pioneers to take some arrows but ultimately endure by being on the right side of making sustainable products.
We need more product creators and companies to lean in, make sustainable products and capitalize on whitespace in their product categories. If anyone needs help unpacking the whitespace for sustainable products in their category, reach out.
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