Ethics and “Price Gouging” in Florida

There is always a debate when it comes to price gouging and virtue because it can cause many problems/dilemma in our society. Price gouging occurs when goods and services are being charged more than the normal amount, which happens in a natural disaster. An example that was mentioned in the book was that in the aftermath of Hurricane Charley, generators that go for $250 were now raised to $2000 (Sandel, 2009, p. 3). The concept of virtue is what society wants to encourage in a community such as good traits or qualities of character which are accepted. (Sandel, 2009, p. 7). According to Sandel, virtue is a principle which is used as a decision making to determine what’s right and wrong in a society. The concept of virtue applies to price gouging

| The establishment relies on their customers to shop at their stores but also they try and bring in

However, forecast errors will also lead to unhappy customers, lost sales, and excessive inventory. To minimize errors, retailers should find the right demand forecast. Retailers do not want to have a lot of inventory sitting in the back room and too little inventory that will cause out of stock. Holding huge inventory will cause a retailer to have more expenses and decrease their profit if item is not sold especially if the product is innovative type like electronics. The challenge is to balance the inventory with demand. Communication and contribution from people in functional area is also important to create better information and improve overall accuracy. At this time, customer satisfaction will start to decrease. For example, MPRNews says one of Target loyal customer, Ann Hendricks, she is disappointed with target store in St.Paul. “Too many times, she says that store is out of the milk, coffee, bread, pasta and other staples she wants. At Target, sometimes the whole section of cheeses is blank. There's nothing in there” (Moylan). A loyal customer like Ann Hendricks goes to the Lunds & Byerlys store in downtown St. Paul to buy her grocery

A reduction in shelf space and warehouse space could reduce TCC’s revenue and increase transportation and storage expense due to the amplified turnaround time on processing orders.

If the operation have not reordered all the goods they need, this can lead to irritated customers and lower revenue for the operation.

Company Q has had a large demand from their customers to provide healthy and organic foods over the last few years. They recently started offering a small variety of health and organic food items, which is a step in the right direction toward being socially responsible. They need to be more attentive to the needs and wants of their customers as it shouldn’t have taken years to bring in these demanded products. When there is a demand for products and the company doesn’t respond to that demand, it’s perceived by the consumers that the company simply doesn’t care about their needs and wants. Bringing in a selection of these products was a good start in satisfying their customers. However, with such a demand for these items, having a small and limited selection is just not enough. Expanding the line of health and organic food items will accomplish two things. First and foremost it will appease the current customers and bring in a new clientele that is health conscious, thus helping to create a healthier community and at the same time increasing sales. The higher margin on the health and organic items coupled with the increase in sales will really boost the overall profit margin of the company. Company Q does need to be sure that they don’t over price these products so as to not push away business due to overpricing.

The same is true for Florida, which reviews their minimum wage in accordance to a cost- of- living formula (Moody, 2014). Both states have proven that there is a direct correlation between having enough money to survive and the cost- of- living. CEO of the Kansas Restaurant and Hospitality Association, Adam Mills, states that “If the minimum wage goes up, then something else has to give… It’s a combination of higher prices and fewer people working” (Voorhis, 2013). Furthermore, Kansas, Washington, and Florida aren’t the only states seeing these trends. One writer from Pittsburgh named Jack Markowitz says “A certain side- effect is the cost of doing business: pressure on prices. Consumers pay more as workers earn more” (Markowitz, 2009). The effects of the correlation between minimum wage and cost- of- living are not just visible to government officials, but to writers and consumers alike. Along with paying more as prices spike, the value of the dollar goes down. The more money the government puts into circulation, the less value it has- just like anything else. David Cooper claims that at $7.25 an hour, minimum wage has declined by more than 26% since 1968 (Lester, 2012). If the value of the dollar keeps declining, hiking the

Improve inventory days. This is part of Horniman’s business; it is unclear whether the inventory can be improved, particularly if they are moving to more-mature plants. The analysis to make this trade-off is similar to that of the payables policy. One would divide the expected margin gain by the increase in inventory levels to compute a marginal return on capital. One additional level of concern is the substantial additional risk associated with increasing inventory when facing uncertainty with respect to the effects of interest rates and adverse weather.

The following is an analysis of the case, Greaves Brewery: Bottle Replenishment. It details the growing beer operation of Greaves Brewery located in the Caribbean island of Trinidad. The purchasing manager for the company, Alex Benson, is uncertain about how many bottles to order from the company’s German glass supplier. His decision is complicated by the possibility of a new bottle design being introduced that would compromise his existing inventory of bottles. Additionally, he is faced with storage limitations and erratic sales, all of which are impacting his decision. He is also concerned about over ordering to avoid issues from an

Price protection (cost caused by changing value of the inventory held by HP’s channel partners)

As it states in Business Case #1 introduction: “In business, it is often necessary to make decisions on the basis of data from the past”, however, I believe that when you have an unexpected natural disaster forcing customers to make drastic purchases – this statement would just be at this moment a rule of thumb and the market equilibrium’s demand or supply has changed the price and quantity. A good example would be with our most recent natural disaster, Hurricane Irma. I’m looking forward to comparing the financial reports of Home Depot before and after Hurricane Irma. I have been able to completely appreciate this form of financial concept using different forms of formulas used to find out what the sales revenue was especially on “plywood”.

Herbert Hoover once said “Competition is not only the basis of protection to the consumer, but is the incentive to progress.” (Hoover, n.d.). Every company must progress over time and find ways that will draw in consumers. Using Target Corporation as an example, the company’s pricing strategy, covering company objective, competition and customers that belong to the five Cs of pricing, will be discussed. Then, Target’s retail strategy will be discussed using the four P’s; product, price, promotion and place.

When a hurricane hits a location, many con artists take advantage since there’s desperate need for money at the moment. To those who financially wealthy, they’ll use that opportunity to become wealthier. There are a few ways con artists may scam a innocent person, one of which is by price gouging. Price gouging, at first, will be noticeable when one travels from gas station to gas station. A con artist may, for example, raise gas prices above the national average in attempt to obtain a profit in a large profit in the long run. In the case of Hurricane Sandy in 2012, price gouging was not tolerated. As a matter of fact, price gouging, where Hurricane Sandy hit the hardest in New York, will not tolerate an excessive increase in not just

The following is an analysis of the case, Greaves Brewery: Bottle Replenishment. It details the growing beer operation of Greaves Brewery located in the Caribbean island of Trinidad. The purchasing manager for the company, Alex Benson, is uncertain about how many bottles to order from the company’s German glass supplier. His decision is complicated by the possibility of a new bottle design being introduced that would compromise his existing inventory of bottles. Additionally, he is faced with storage limitations and erratic sales, all of which are impacting his decision. He is also concerned about over ordering to avoid issues from an off year, impact from

❖ Adjustments to inventory levels should be made in order to accommodate demands during peak seasons and low selling months.