Headquartered in São Paulo, Brazil, Pão de Açúcar Group is the second-largest multi-format retailer in Brazil with 575 stores and US$ 10 billions gross revenues in 2008. Pão de Açúcar is the high-end Brazilian store brand in the Pão de Açúcar Group, comprising 144 stores. 
                                                                                                                                                                                                                                            
Pão de Açúcar Group has been a pioneer in innovation and customer service, leading the way with grocer e-commerce, high technology stores and in-store recycling since 2001, as well as encouraging customers to be more environmentally conscious.     In 2005, the supermarket chain became the first Brazilian retail company to offer returnable "ecobags" as an alternative to plastic bags. Since then, more than 300,000 ecobags have been sold across Brazil.

In 2008, Pão de Açúcar made its biggest investment in sustainability when it built and began operating Latin America's first "green" supermarket-known as Pão de Açúcar Loja Verde in Portugueselocated in the Indaiatuba region. The store serves as a model for sustainable retailing, not only for the company, but for retailers throughout Latin America and the world. The Pão de Açúcar Green store is the first supermarket in Brazil to apply for certification from the Leadership in Energy and Environmental Design (LEED) according to the standards set by the U.S. Green Building Council. The certification process includes:
1.	 Construction phase auditing (construction materials and processes)
2.	Evaluating  store operations (water, energy consumption and operational standards analysis)
3.	Store KPIs analysis

The store also serves as a working laboratory for testing new business practices in sustainable technology--innovations that can be used throughout the Group's stores. 

Before launching its green store initiative, Pão de Açúcar executives worked with Accenture to develop a pioneering sustainability vision. Together, they conducted extensive research into emerging consumer trends, the future shopping experience and use of innovative technologies, including curbing energy consumption, tracking purchasing behavior, creating tailored offerings to providing customers with interactive product information as they shop. Pão de Açúcar executives also toured the sites of leading US retailers to observe state-of-the-art sustainability practices at work.

 Pão de Açúcar decided to implement 13 green initiatives that set the standard for best practices:

	Reduce plastic bags usage.
	Obtain LEED certification to ensure efficient operations and sustainable building techniques and materials.
	Increase sustainable, organic and natural products.
	Institute a store/customer recycling program.
	Strengthen sustainability culture among collaborators and suppliers.
	Reduce paper use in marketing.
	Incorporate sustainability in the shopping experience. 
	Increase selection of locally traded products.
	Expand its Little Citizen (PA Kids Project) program,  fostering  childrens conscientious consumption 
	Reduce packaging materials.
	Reduce energy and water usage
	Use  certified wood from reforested areas
	Increase  store waste recycling (dry garbage to recycling plants; organic garbage to fertilizer plants)

The Pão de Açúcar/Accenture team also developed a detailed value proposition for the green store, as well as guidelines for the stores look and feel, product assortment, price/promotion, customer service and marketing. Pão de Açúcar increased the brands sustainability footprint by ensuring that the store is aligned with the companys brand positioning and made full use of sustainability concepts and innovations.

 By effectively using technology (detailed in the next section), within nine months of its opening, the green supermarkets water consumption dropped by 10 percent and energy use is 14 percent lower than comparable stores. Some initiatives already have been put into practice at other stores. They include purchasing locally traded products, reducing packaging materials and plastic bags, using more energy-efficient lamps and displays and offering incentives to collaborators and suppliers who adhere to sustainable policies. 

Technology plays a key role in the construction and operation of Brazil's first green supermarket. The store's building design was adapted to LEED requisites, which recommend construction methods and procedures that increase efficiency in the use of resources and reduce the social and environmental impact of the building process. The end result is the ability to conserve energy, drinking water and the application and use of materials.  

For Pão de Açúcar, this meant establishing clear priorities and changing key systems. The store used the ecologically correct R404 gas for all refrigeration display cases and air conditioning. It was constructed with a translucent ceiling to maximize natural lighting and employed a highly reflective canopy to reduce heat.
 
The company took several other steps to improve efficiency and reduce energy consumption, such as implementing a sophisticated lighting control system that uses timers and intelligent sensors throughout the store's facilities. When selecting equipment and systems, Pão de Açúcar selected products that were just as productive as or better than traditional choices but consumed less energy. For example, water in showers and handling areas is heated with excess heat from the boiler room. The supply of energy originates 100 percent from renewable sources  green energy.
 
In order to maximize water use, the company also installed high-performance faucets and toilet bowls that have reduced water volume by 40 percent.  The air-conditioning system does not use water to regulate the temperature. By preserving local flora and planting native vegetation over 26 percent of the outside plot, the store is on track to save about 100,000 liters of water a month. Since native plants are adapted to the local climate and rainfall, theres no need for irrigation.

Another initiative adopted by Pão de Açúcar Loja Verde includes strollers and baskets made from recycled plastic bottles. This innovation resulted from new recycling technologies used in the stroller and basket project, as well as construction.  

Meanwhile, technology is important in the development of many of the sustainable products sold in Brazil's first green supermarket. For example, Petropolis-brand carbon-neutral water comes in 510 ml PET bottles with the lowest gramature on the market: 16.5 g to 17.0 g. The label is made of recycled paper--the first Brazilian brand of mineral water to use this type of paper for product labeling. The carbon neutralization takes place during the manufacturing process at the bottling plant and the label bears a carbon-neutral green seal. Shipping boxes are made from recycled and returnable cardboard, reducing the environmental impact of waste.

Yes

Yes

Pão de Açúcar's green supermarket was built to serve as a model for sustainable retailing. By setting a new standard for environmentally conscious businesses not only in Brazil but throughout the world, the new store will deliver benefits that can't be measured--and know no bounds. The project is demonstrating to all retailers that it is possible to be both a sustainable and profitable business.

Today, Pão de Açúcar and the community served by its green supermarket are reaping numerous benefits. The store is the first in Brazil to apply for LEED certification, a process that should be completed within three months. Pão de Açúcar Verde serves as a laboratory to test new business practices and sustainable technologies and establishes initiatives that can be used to expand the business based on the best sustainable practices in the Pão de Açúcar Group. It enables the dissemination of sustainable practices to partners, suppliers and the community at large. Pão de Açúcar Verde effectively weaves sustainability into the fabric of Pão de Açúcar Group's core, driving new capabilities and innovation throughout Brazil.

"This is more than a flagship store. This store is part of a project that is not ending today; in fact it is starting today. We will incorporate what we learn from Pão de Açúcar loja Verde to include more sustainability elements in other store developments," says João Edson Gravata, operations director. Some initiatives, such as purchasing locally traded products, reducing the use of plastic bags, using more energy-efficient lamps and strengthening the culture of sustainability among collaborators and suppliers, already have been implemented in other outlets.

Although the green supermarket has been operating for only nine months (since June 2008), it already has met some important milestones: water consumption is 10 percent lower and energy consumption is 14 percent lower than other comparable stores. It offers the first recycling station made from 100 percent recycled and recyclable materials. Customers can drop off used batteries, with equipment designed especially to properly and ethically handle such material.

In addition to the ease of depositing used products, customers can recycle paper and plastic packaging materials from products at the check-out counter at the time of purchase. This is the Caixa Verde ("Green Check-Out") project, launched by the Pão de Açúcar chain earlier this year, and now available at 14 other stores. At the Indaiatuba store, this option is available at four checkout lanes.

And it's not just consumers who are involved in the companys zero waste crusade. Employees are trained to separate garbage at stores, with the goal of recycling 90 percent of all waste generated in the operations process, including organic materials. Organic waste is reclaimed for livestock feed; scraps of wood, pallets and crates are used in furniture manufacturing; and the rest (paper and plastic) is sent to recycling centers. 

Company vehicles use biofuel (alcohol and biodiesel), reducing the environmental impact.

For the community, the new green supermarket serves as a classroom in sustainability. In fact, under the PA Kids Project, schools in the region visit the new store to learn first hand about environmental issues and to receive information on consumption, sustainable operation and recycling systems. The goal is to build awareness of how individual efforts can help preserve the environment. Also important: the store's emphasis on selling fresh, locally grown produce not only reduces fuel costs for deliveries but helps support local growers and farmers.

"In our case, having a green Pão de Açúcar store functioning in our city is very important. The Pão de Açúcar Group has a working philosophy very similar to our government, in support of citizenship projects, encouraging sports, and respecting the environment," says José Onério da Silva, Indaiatuba's mayor and the president of Conselho de Desenvolvimento da Região Metropolitana de Campinas.

Having a recycling station in the supermarket is very convenient because sometimes it is difficult to have a garbage recycling program at home. We have to support these types of initiatives, which help to improve our society and the planet. Ricardo Spindola, Store Customer

At first it is difficult to say whats different about the store. But the sustainability concepts show up in the details. Solar power usage, a roof with thermal painting, leading-edge air conditioning and refrigeration systems and lamps that save energya combination that works. André Trigueiro, Television Reporter

Organic lettuce makes the difference. Its much tastier and fresher. The other day I made a juice from organic kale and organic mint. It is delicious, really good!!! Carmem Lúcia Cardoso da Silva, Store Customer

We are more conscientious. Many supermarkets are throwing things away, wasting energy and many other things. We may not be 100 percent green yet, but we are trying to get there. Herbert Vital, Store Employee

We work at a highly sustainable store. I have never participated in an initiative like this before. This is a new store that really motivates everyone, including our clients. Weve started using these ideas in our homes and we hope our customers will too.  Adriana Roni, Cash Register Operator

This is great! The cart and shopping basket idea, using recycled plastic bottles. The whole store!!! Ana Maria, Customer

Pão de Açúcar loja Verde is the first major effort by a Latin American retailer to demonstrate the potential for sustainable retailing. Originality is evident in everything from the location of the store to the materials used in its construction to systems for recycling organic and solid residues, dry cells and batteries. For example, the location was chosen in part for its access to local and organic fruits and vegetables. The site required hardly any leveling or clearing of land. 

The supermarket's construction process is designed to significantly reduce the impact on the environment and the local landscape by considering factors like sedimentation and erosion. In order to prevent the transport of waste products out of the store and to minimize dust, the wheels of the trucks were washed as the vehicle exited the construction site and water used in the process was stored in a tank for recycling at the job site. Another innovative system used in construction was the management of debris, which was segregated in dump trucks and divided by type: part of the debris was reused on site and another part was reprocessed by companies located in the region. Moreover, 40 percent of all materials used in construction came from vendors located in nearby areas, avoiding long-distance freight costs.

The company achieved dramatic monthly savings in water consumption by landscaping with native plants and preserving local flora that didnt require irrigation. Sustainability of space and materials is evident in the parking lot, where 75 percent of the shade is provided by trees and only 25 percent by metallic shelters. Also in outside areas, the pavement, composed of cinder blocks and grass-filled spaces, will ensure greater ground permeability, allowing the drainage and supply of ground water without flooding. 
 
While the Pão de Açúcar supermarket chain was the first Brazilian retail company to innovate the use of returnable grocery bags, consumers still have plastic bags at their disposal. But these bags are being redesigned to make them greener: they will be 100 percent recyclable, with a thicker texture than traditional plastic bags and produced in 3 layers25 percent virgin material for the outer layer, 50 percent reprocessed material for the middle layer and 25 percent virgin material for the area that comes into contact with food products. Because it's stronger, these green plastic bags can be reused and dont require double bagging to carry groceries. Meanwhile, cardboard boxes, Kraft bags and paper bags are available, all certified by the Forest Stewardship Council (FSC), assuring that the paper used for making the packaging material was obtained from reforestation.

Pão de Açúcar surmounted a major challenge that threatened efforts to create Brazil's first LEED certified retail establishmentmeeting the strict requirements needed for certification. According to the USGBC (United States Green Building Council), a LEED-certified building must demonstrate an ability to significantly reduce the emission of residues, with an increase in green areas. Such buildings should provide greater user satisfaction and a decrease of health problems and greater productivity by staff members. The USGBC stipulates that a facility should expect to save 30 percent in energy, 35 percent in carbon emissions, 30 to 50 percent in water, and from 50 to 90 percent in the disposal of residues. As a green retailer pioneer, the company had to develop a methodology and support team to design, build and launch its green supermarket. Based on the results of the first three steps in the certification process, Pão de Açúcar has surmounted this challenge, which included meeting several green requirements. 

During the building phase of the store, Pão de Açúcar had to:
	Locate recycled material for the stores construction
	Research the best way to use the recycled material in the construction
	Find suppliers of green technologies and material, often unavailable near the store: For example, the best technology for concrete was not available in Indaiatuba. And there was no large-scale, local supplier of green material for packaging fruits and vegetables, capable of meeting store demand. 

The green store concept was fully embraced and supported by Pão de Açúcar.

Achieved

Some initiatives, such as purchasing locally traded products, reducing the use of plastic bags, using more energy-efficient lamps and strengthening the culture of sustainability among collaborators and suppliers, have already been implemented in other stores. In addition, the recycling stations now are in place in all Pão de Açúcars stores, the green box is in 14 stores, with plans to expand to 30 stores by the end of the year. 
The company is in the process of rolling out several green initiatives in its other store, including reducing paper and plastic in private label products packaging, a larger assortment of organics, and the use of returnable grocery bags.  And, Pão de Açúcar is demonstrating its long term commitment to sustainability, with plans to open a second green store in São Paulo during the 2009/2010 time frame.

Because Pão de Açúcar Verde serves as a working laboratory for testing new business practices in sustainable technology, its an invaluable tool for the local community and retailers throughout Latin America and the world.  They can see first-hand how green initiatives are employed successfully in a retail environment and learn how to achieve LEED certification.

Feedback from both customers and employees has been overwhelmingly positive. They have very quickly embraced the green store concept as well as innovations that make it easier for them to support sustainability. The recycling stations promote increased recycling. If customers dont have recycling bins at home, they can use the supermarket stations. Strollers and shopping baskets made from sustainable materials demonstrate the viability of such innovations. Organic, locally grown food allows customers to enjoy healthier and tastier meals. And employees, who are trained to educate customers about sustainability, are proud to work in a pioneering environment. Latin Americas first green supermarket is modeling sustainable practices that can be used in consumers own homes.