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Business Ethics

  1. Sep 21, 2007 #1


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    Business invest time to attract customers, but some customers are simply not worth having. So some business think that they should fire the customers they lose money on.

    -Is it acceptable to fire customers who cost you money on an ethics point of view?
    -Is it acceptable for the company to focus efforts on profitable customers or should they all be treated equally?
    -What is the downside of finding which customers are profitable and discourage those that are not profitable?
  2. jcsd
  3. Sep 21, 2007 #2


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    The only ethical requirement for a company is to enhance shareholder value.

    By treating unprofitable customers failry you will lose money - the poor starving pensioners who have invested in your company by buying shares will suffer.

    Finding the right customers and the competition for them with other businesses, rememebr everyone wants the plum customers but you might do better long term by making your business efficent enough that you can make money from the non-plum customers.
  4. Sep 21, 2007 #3


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    Of course a business has the right to refuse customers that cause more trouble than they are worth.

    Companies routinely do special things for their better customers.

    There are companies that actually gather this data for companies to determine which clients to cater to and which are losers. The only downside is that if you are one of the undesireable customers, you may not be able to buy from certain companies.
  5. Sep 21, 2007 #4
    Business is in business to make a profit, period. If a company cannot make a profit they will not be in existance very long. Good business is done when the parties come away with what they want at a price they are willing to pay, this price varies from person to person just as the quality of the product varies from one manufactuer to manufacturer. The only downside to culling your customer base for the most profitable customers is that all things change. If the market changes or the customer base changes you may find yourself trying to once again obtain the business of those customers you deemed previously not profitable enough to service.
  6. Sep 21, 2007 #5
    It might cost more to find out than you save by culling. I think it is perfectly atrocious that your company behaves this way, and perfectly acceptable that mine does.
  7. Sep 21, 2007 #6
    I've heard of some people that are in business just to make a living
  8. Sep 21, 2007 #7
    This "living" is derived from the profits. Can the owner forgo a paycheck for the betterment of the company? Sure, but a company can't go on forever that way. The headaches of ownership tend to make a person want something for all of thier hard work, but not everyones definition of "living" is not the same.
    Last edited: Sep 21, 2007
  9. Sep 21, 2007 #8
    just depends on a person's viewpoint-----from "Mayberry"/(Andy Griffith Show) to "Wall Street"
  10. Sep 21, 2007 #9


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    For a privately owned business this is true - I can choose to work with certain clients because the work is interesting or they are more pleasant to work with. It is upto me to decide how much money I want to make.

    For a listed company, the shareholders are trusting me to make the best decisions for their money. If I choose to keep unprofitable customers because I like them - I am defrauding the shareholders in exactly the same way as if I stole the petty cash.
    Most shares are held by pension funds - hence my joke about robbing pensioners if you don't try and make as much money as possible.
  11. Sep 21, 2007 #10
  12. Sep 21, 2007 #11
    Enron is a perfect example of a company whos leadership put thier own self serving interests above the shareholders. Enron, believe it or not, is the exception not the rule.
  13. Sep 21, 2007 #12
    The mortgage companies (lately)?
  14. Sep 21, 2007 #13
    There are lots of mortgage companies, I assume you are refering to the few sub-prime lenders that engaged in over zealous lending practices specifically. There are thousands of companies traded on the NYSE alone. I can cherry pick anything and find a few bad apples out of any bunch.
  15. Sep 21, 2007 #14
    You mean bunch of grapes?
  16. Sep 21, 2007 #15
    Must be my southern tongue, bunch can be used for grouping of anything.
  17. Sep 21, 2007 #16
    But can apples be cherry picked?
  18. Sep 21, 2007 #17
    Of course anything can be cherry picked. Just like those bucket trucks you see working on powerlines are of course, cherry pickers!
  19. Sep 21, 2007 #18
    hey--all I was pointing out was that it went from " the exception not the rule." to "a few bad apples" pretty quickly
  20. Sep 21, 2007 #19
    True, true, but then it wouldn't be funny.
  21. Sep 22, 2007 #20
    Business Ethics <<--- I think this thread should be in "Scepticism and debunking" :rofl:
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