Most of a retailer's emissions are Scope 3: the goods it buys from suppliers and what happens when customers use and throw them away. Stores and warehouses matter, but are usually a smaller share. Retailers decarbonise by mapping their value chain, cutting store energy, switching to renewables and working with suppliers on the products that drive their footprint.
Decarbonisation means cutting the greenhouse gas emissions a business causes, in its own operations and across its value chain. For a retailer, that value chain runs from raw materials and manufacturing through shipping and stores to product use and disposal.
A retailer sits at the end of the grower, producer and manufacturer chain. So most of its footprint is other companies' emissions, counted as its Scope 3.
They come mostly from purchased goods, then from logistics, stores, and the use and disposal of sold products. The table maps typical retail hotspots to the GHG Protocol scopes and categories.
| Hotspot | GHG Protocol scope / category | Example | Main levers |
| Products bought for resale | Scope 3, Cat. 1 (purchased goods and services) | Clothing from contract factories, food from growers | Supplier engagement, lower-carbon sourcing, product footprints |
| Inbound logistics | Scope 3, Cat. 4 (upstream transport) | Shipping and trucking goods to warehouses | Mode shift, load efficiency, low-carbon fuels |
| Store and warehouse energy | Scope 2 (electricity), Scope 1 (gas, diesel) | Lighting, air conditioning, heating | Efficiency, renewable electricity |
| Refrigeration | Scope 1 (refrigerant leaks), Scope 2 (power) | Supermarket chillers and freezers | Leak control, low-GWP refrigerants, efficient units |
| Use of sold products | Scope 3, Cat. 11 | Electricity used by phones and appliances sold | Stock more efficient products |
| End of life of sold products and packaging | Scope 3, Cat. 12 | Packaging and goods sent to landfill | Recyclable design, take-back schemes |
A few examples:
Packaging cuts across all three. See our guide to decarbonising packaging.
Climate change is already a business risk for retailers. Copernicus found that 2024 was the first calendar year with global average temperature more than 1.5°C above pre-industrial levels, at 1.60°C (Copernicus Global Climate Highlights, January 2025).
For retailers, this shows up as:
Because the pressure comes from several directions at once, and early action costs less than late action.
Start by measuring the full value chain, then follow a mitigation hierarchy: avoid, reduce, substitute, remove, and only then compensate. Our post on the mitigation hierarchy explains how this links to SBTi targets.
Map your whole value chain to find high-emission hotspots. Collect supplier data for the product categories that matter most, and use estimates for the rest. Focus effort where materiality is highest. Our value chain mapping workshop is a structured way to start.
Prevent emissions before they happen. Examples: replace some business travel with virtual meetings, design out unnecessary packaging, and choose lower-carbon products when setting up new ranges.
Where activities must continue, make them less carbon-intensive. Examples: switch delivery fleets to electric vehicles, upgrade lighting and refrigeration, and use recycled materials in own-brand products.
Replace fossil fuels with renewable electricity, through green tariffs, power purchase agreements or on-site solar.
Most reductions happen in the supply chain. Set clear data requests, share targets and support key suppliers with tools and training. See our Scope 3 supplier engagement tips.
Under the SBTi Corporate Net-Zero Standard, companies must cut the large majority of their emissions, typically 90% or more by 2050, before neutralising what is left with carbon removals. Removals inside the value chain, such as agroforestry with suppliers, are preferred. Carbon credits do not count towards reduction targets.
Retailers need product-level data from their suppliers. Pokka, the beverage brand, used Terrascope to calculate product carbon footprints for 4,980 SKUs, with about 92% accuracy on 700 of them. Read the Pokka case study.
Terrascope helps retailers measure and cut the Scope 3 emissions that make up most of their footprint:
For the wider Scope 3 picture, read our guide to Scope 3 emissions.
What are the biggest sources of retail emissions? For most retailers, products bought for resale (Scope 3, Category 1) are the largest source. Logistics, store energy, refrigeration and the use and disposal of sold products follow.
How can retailers reduce Scope 3 emissions? Map the value chain, focus on the product categories with the highest emissions, and work with those suppliers on data and reductions. Product carbon footprints help buyers compare and choose lower-carbon options.
How does climate change affect the retail industry? Extreme weather disrupts production and shipping, raises raw material and freight costs, and makes weather-dependent stock harder to forecast. 2024 was the first calendar year above 1.5°C (Copernicus, 2025).
What is the mitigation hierarchy? A priority order for climate action: avoid emissions, reduce them, substitute cleaner energy, remove what's left, and only then compensate with credits.
Do refrigerants count in a retailer's carbon footprint? Yes. Leaked refrigerants from chillers and air conditioning are Scope 1 emissions, and many have a high global warming potential.
Want to find the hotspots in your retail value chain? Contact our team.