There’s a lot of talk about “going green” these days and many businesses are jumping on the “we’re green” bandwagon. But from a financial perspective, is it good for cash flow?

As with most ideas, it depends upon the company and how it uses its green corporate culture to leverage business.

For instance, a hair salon that decides to choose only organic products may spend a good amount to ensure that all shampoos, conditioners, dyes, etc., meet organic standards. Chances are good that their efforts will initially result in a heavy outlay of finances, especially if they are restocking their shelves. So from an expense standpoint, many CPAs or CFOs would look at the bottom line and say, “Whoa! Hold your horses! This going green isn’t going to be too good for you!”

However, there’s another side of the coin and that’s the way a business can leverage their “greenness”. Say this all-organic hair salon actively markets itself as the ONLY one of its type in an x-mile radius. And say the owners do a terrific job of positioning their company as exclusive, eco-friendly and cutting-edge (pun intended.) If they are able to woo new clientele with a higher-than-average frequency from their competitors, they could just offset the cost of going green with an abundance of cash.

On the other hand, a company that “goes green” and does nothing to leverage their environmentalism may indeed hurt their cash flow rather than help it. And for some owners, that’s okay - it’s more important to go green than to make money. But at the end of the day, bills do need to be paid.

If you’re thinking of changing the way your organization operates to a greener style, I urge you to sit down with your CFO, CPA and marketing consultant. There may be tax breaks (or even government funding) you don’t know about, not to mention advertising possibilities you’ve never considered. It’s worth the investment to do a little contemplating and planning before moving your business toward an eco-friendlier way of working.

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