Sweetgreen Adds Steak To The Menu

What's The Deal:

Earlier this month, the salad chain Sweetgreen (NYSE: SG), announced the addition of steak to its menu. Shortly after, its stock soared. However, many consumers raised climate concerns and questioned how this decision would impact the company’s goal to be carbon neutral by 2027; beef production is the largest agricultural source of greenhouse gasses globally, emitting massive amounts of methane into the atmosphere.

What They Got Right:

Sweetgreen’s position is that the beef they sell is grass-fed and pasture-raised, sustainable, and rooted in regenerative agriculture—all better for the environment. The company’s announcement intentionally focused on sourcing, bringing attention to the broader benefits of regenerative farming practices and highlighting how this move aligns with the brand’s ethos.
Sweetgreen is also transparent about relying on carbon offsets to help meet its climate pledge. Offsets are an effort to cancel out one’s own carbon dioxide [CO2] pollution by investing in other activities that lower the amount of CO2 in the atmosphere.
There were no boycotts and little negative press. Most news reports covered these aspects in a balanced and overall positive light.

What's The Watch Out:

To stay true to environmental sustainability as a core principle, Sweetgreen will need to ensure that its supply chain can meet its standards, volume, and distribution needs as sales increase. While regenerative agriculture practices and carbon offsets can help lower overall emissions, they do not replace the need to abate emissions at the source of operations to mitigate climate change.
From a business standpoint, it's a sound move as it will likely drive unit sales, revenue, potentially new users, and traffic. But time will tell if it will negatively impact Sweetgreen’s positioning as a “plant-forward, Earth-friendly” brand and whether it will be able to meet its 2027 pledge.

For these reasons, we recognize the Sweetgreen communications team #ForTheWin.

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Disclaimer: Sweetgreen is not a Perceptual Advisors LLC client.

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