Retail ethics affect everything from customers’ perception of a brand to the safety of the employees themselves. Retailers have a responsibility to be as ethical as possible or it can have a negative effect on the industry.
While ethics are often pushed aside in the name of competition, businesses putting ethics first have fewer problems. They’re also able to build better customer loyalty.
Unethical Competitive Practices
Competition is part of being in the retail industry. However, it doesn’t mean cutting corners or lying to customers. It also doesn’t mean forcing other businesses to resort to the same unethical practices to stay competitive. All it takes is one or two retailers to start selling sub-par products labeled and priced as higher quality items to start an unethical competition. It may take time for customers to realize what’s going on.
In the meantime, other retailers do the same thing to avoid losing customers. However, the truth eventually comes out and the retailers who survived this competition come out on top while the others suffer.
Treating Employees Fairly
Retail ethics apply to business practices, employees, customers and vendors. This means businesses need to treat and pay employees fairly. It’s not unusual to randomly cut hours, but expect employees to work harder to accomplish the same amount of work. Retailers might also ignore complaints or fire employees unfairly for speaking up.
While some employees are unethical themselves, most aren’t. However, unfair treatment may lead to the mindset that they’ll just take what they deserve, such as money and products. This leads to higher prices for customers and can shut down retailers completely.
Every retailer wants to increase profits, but retail ethics means do this fairly and transparently. Any type of deception in order to get a customer to buy something is unethical. For example, employees may get a bonus if they recommend a higher priced item over a cheaper item, even if the cheaper item is actually better. Some retailers opt for pricing deceptions, such as advertising a major sale, but marking up the original price so the sale price isn’t nearly as big of a discount.
When customers realize this, they will shop elsewhere. It does create short term profits, but long term losses. It’s also illegal to deceive customers like this.
Going Beyond The Business
Today, people prefer ethical companies that help make the world better. Retailers that partner with local nonprofits are able to increase business and build customer loyalty. For instance, if a retailer donates 10% of profits every Thursday to a local or global charity, customers who support that cause are more likely to shop there.
Retailers who prefer to avoid any type of community involvement find it harder to compete. Even just helping with advertising or donating products now and then can help customers see a retailer as a more ethical business. The good part is the nonprofit also helps market the retailer, so it’s a win-win for everyone.
Retail ethics have the power to improve the entire industry. Whenever customers or employees suspect or can prove unethical practices, they should report them using a whistleblower hotline.