Profit motive

For food and beverage (F&B) businesses, the shift towards more sustainable, eco-friendly practices is undeniably the future, but justifying the higher costs associated with sustainable ingredients, practices, and products, is a challenge.

Although surveys suggest that consumers are willing to pay more for sustainable products (PwC's report, for example, highlights a 9.7% premium that global consumers are prepared to spend on sustainably sourced products) actual spending patterns don’t always align with these intentions.

So, what practical steps can F&B brands use to capitalise on sustainability while maintaining profitability?

Targeting the right customers
Targeting the right consumers through the right channel, particularly younger and more affluent consumers, who see sustainable products as fashionable and high quality, is essential. A lot of unnecessary cost and waste can be avoided targeting consumers who do not value these types of products, and place price as having the most importance.

In our work we have found that sustainable brands need to clearly communicate a few simple key statistics on the initiatives they are undertaking at the point of consumer contact. This can justify any price premium they have compared to similar, cheaper brands.

Patagonia Provisions, an extension of Patagonia, offers sustainably sourced food products, emphasising regenerative agriculture and Fair Trade practices. Its premium pricing resonates with loyal customers such as outdoor enthusiasts and health-conscious, environmentally aware consumers. Patagonia Provisions has successfully carved out a profitable niche, strengthening Patagonia’s overall customer base.

Operational efficiency
Reducing energy use and waste through efficient technologies is crucial to improving margins, even with high initial investments. Energy-efficient appliances, optimised workflows, and waste-reduction practices lower costs while enhancing sustainability. These savings boost profitability and reduce environmental impact, further enhancing a brand’s reputation.

Chipotle has focused on reducing energy use in its restaurants by investing in energy-efficient appliances, like advanced cooking equipment and LED lighting, which have helped lower electricity consumption. The company also powers a significant portion of its locations with renewable energy, including wind and solar power. By implementing energy-efficient technologies, Chipotle saves approximately 15-20% on its energy costs across its restaurants. This is significant, especially when considering the chain operates over 2,800 locations globally

New markets and investment
Sustainability can also open up new markets and investment opportunities. ESG (Environmental, Social, and Governance) investing has grown, and companies that demonstrate a commitment to sustainability are more attractive to investors.

Oatly capitalises on the demand for plant-based, dairy-free alternatives. Its 2021 IPO raised over $1.4 bn, reflecting investor confidence in its sustainability-driven model. Oatly’s partnerships with cafés and supermarkets, alongside premium pricing, help offset global expansion costs. The money raised from going public helped it to expand its manufacturing and marketing campaign cater to a wider global demand. Despite challenges in scaling and competition, Oatly continues to show that eco-conscious brands can be both sustainable and profitable.

Regulatory compliance and risk management
This involves adapting to regulations like carbon reduction and food waste management under policies such as the EU’s Green Deal and the UK's zero-waste initiatives. Brands that lead in compliance can attract partnerships and access grants or tax incentives.

BrewDog’s commitment to sustainability has enabled the company to access significant government grants and tax incentives, which contribute to major cost savings. By investing in renewable energy technologies such as their £12 million bio-energy plant, BrewDog could benefit from UK government grants like the Industrial Energy Transformation Fund, potentially receiving support in the range of £250,000 to £10 million, depending on the scale of the project.

Furthermore, as a carbon-negative business, BrewDog avoids potential future carbon taxes, which could cost companies between £18-25 per tonne of CO2 emitted. By reducing 7,500 tonnes of CO2 annually through its sustainability initiatives, BrewDog avoids around £135,000 to £187,500 in carbon taxes each year. Altogether, combining grants, tax relief, and avoided carbon taxes, BrewDog stands to save millions of pounds, significantly offsetting the costs of its sustainability strategy while reinforcing its eco-friendly brand positioning.


To to be profitable, sustainable F&B companies cannot simply market “sustainability” as a standalone concept or treat all consumers as a single, homogeneous group. Instead, value is unlocked by targeting specific customer segments with tailored messaging and category-relevant claims. This explains why some of the featured brands may not seem entirely "green" at first glance. Additionally, with inflation and rising operational costs, the balance between profitability and sustainability has become increasingly complex.

Looking forward, while the path to profitability for sustainable F&B businesses may take time, younger generations’ growing preference for eco-conscious brands suggests that integrating sustainable practices will likely deliver substantial long-term value.

Emily Lin