Walmart has just broken the $10 price barrier for LED lights. Their stores have in stock a 60 watt equivalent LED light bulb that is being sold for only $8.88. Over its estimated 22-year life this bulb is estimated to save $134 in electricity costs. Buying this light is one of the most prudent investments you can make to cut your electric bill.
A 66% annual return on investment!
Walmart’s $8.88 LED light is estimated to save $5.88 per year in electricity costs compared to an incandescent light. This is a 66% annual return on the $8.88 purchase price of the LED light. If you pay more than 11 cents per kWh for electricity like I do in California then your annual savings might actually be equal to the first year price for this Walmart light!
I did a shop-check of a national-chain competitor to Walmart that also offers everyday low prices. Their lowest price for a 60 watt equivalent LED light was $5 more expensive than the Walmart $8.88 LED light! So buying Walmart’s $8.88 LED light saves $5 compared to buying a similar LED light at a competing store plus Walmart’s light generates an estimated $5.88 per year in energy savings. Combined that is move than a $10 first-year savings compared to the initial $8.88 investment.
Lower labor costs + improved productivity
Because the Walmart $8.88 LED light will last 22-years it requires less labor to maintain or replace. How often do you have to replace your existing incandescent lights? How disruptive is this to your customers and work associates? Add these savings to your calculation on how this Walmart $8.88 LED light can put money in your pocket. Watch the following 3-minute video interview of a restaurant manger explaining how he cut his costs and improved his customer’s dining experience by using LED lighting:
Green supply chain advantages
If your business has not investigated how to win contracts with corporations and government agencies that are greening their supply chain then you are missing a multi-billion dollar sales opportunity. Companies from Walmart to Ford to Unilever plus the Federal government are searching for vendors that are more efficient and operate with less risk. To qualify as a green vendor your company will have to fill out forms showing how you are going green. Most forms will ask questions on how efficiently you are using energy. LED lighting really checks a lot of boxes on these types of forms because they use so much less electricity compared to incandescent lighting technology. Plus LED lights do not generate the huge amount of heat that incandescent bulbs generate so a building’s air conditioning load is reduced. Just installing LED lights won’t make your business a green business but they are a very cost effective way of starting.
Wow! Great light quality
“Wow” was the first reaction when I installed Walmart’s $8.88 LED light in place of the compact fluorescent lights (CFL) I was using. The folks I work with really did not like the light quality of the CFLs. They lived with them because we are dedicated to going green (and they did cut my energy consumption compared to the incandescent bulbs I was previously using). This Walmart $8.88 LED light is bright. The light quality is a huge improvement over my CFLs. It is as good or better than incandescent lights. If you are using CFLs then do yourself and your associates a favor and install LED lights. Your eyes and your work associates will thank you.
A big solution for our economy and environment
LED lighting has a huge potential for saving all of us a lot of money. If every household in America would change just one incandescent bulb to the Walmart $8.88 LED light we would collectively save $675,877,193 per year! Lighting also accounts for almost 6% of global CO2 greenhouse gas emissions or 1,900 million tons of CO2 per year. LEDs, combined with smart controls like an occupancy sensor, can cut the CO2 emissions of lighting by over 50%. Finally, CFLs contain mercury. They require special recycling to capture this mercury. (I had to go to Home Depot to recycle my CFLs because I did not find a recycling container at my local Walmart.) LEDs do not have this environmental problem. If we all switched to LED lighting we would save money plus reduce negative environmental impacts.
Exclusive interview: Walmart Senior Buyer John Prince
I called John Prince, the senior buyer at Walmart responsible for this pricing breakthrough, to learn more about their $8.88 LED light plus how they achieved this breakthrough. Here are the key points from this conversation:
Walmart is focused upon sustainability. Walmart believes that sustainability supports their ability to deliver everyday low prices. Their buyers like Prince are measured upon their ability to develop more sustainable but still price competitive products. Prince worked directly with a LED light manufacturer to create a 60 watt equivalent LED bulb at a breakthrough price below $10.
Walmart’s guarantee. This $8.88 LED light has a three-year warranty. But it is suppose to last 20 plus years. If you buy this light and it fails over the next 20 years John says “bring it back to Walmart.” They will stand behind this bulb. Offering this type of assurance is a proven business best practice for winning customers and growing sales for a new technology.
It’s just not price, its quality too. Prince was especially proud that Walmart’s $8.88 LED light offers a light quality (what he called “color temperatures”) comparable to equivalent incandescent lighting. What he and Walmart have achieved is a breakthrough low price on a quality product.
Big idea delivering big value. Walmart thinks big. They were instrumental in making CFLs a mass market light product and have sold over 100 million CFLs. They have similar big goals for selling LED lights. Prince projects a 300% increase in the sale of LED lights and envisions sales volumes similar to what Walmart achieved for CFLs.
No more excuses: Buy LED lights, now!
There are no more excuses for not installing LED lights. Their prices are dropping to levels that create a superior financial return through energy savings. Where else can you put your money and earn a 66% annual return for 22 years? The light quality is a vast improvement compared to my experience with CFLs. And the light comes on with the flick of a switch compared to the delayed start-up of CFLs. With the type of life-of-bulb guaranties offered by Walmart what’s the risk? Go buy Walmart’s $8.88 LED light and make a difference in your pocket book and our environment.
About the author
Bill Roth is an economist and the Founder of Earth 2017. He coaches business owners and leaders on proven best practices in pricing, marketing and operations that make money and create a positive difference. His book, The Secret Green Sauce, profiles business case studies of pioneering best practices that are proven to win customers and grow product revenues. Follow him on Twitter: @earth2017