This is a set of rules for human moral behavior. For retailers they can have explicit code of ethics or implicit code of ethics. This is a set of rules for human moral behavior. For retailers they can have explicit code of ethics or implicit code of ethics. Explicit code of ethics: Written policy that specifies what is ethical and unethical behavior. Explicit code of ethics: Written policy that specifies what is ethical and unethical behavior. Implicit: Unwritten but well understood set of rules/standards of moral responsibilities. Implicit: Unwritten but well understood set of rules/standards of moral responsibilities. ISSUES ABOUT ETHICS IN RETAILING WHAT IS ETHICS?
DISCUSSION ON ETHICS IN RETAILING Misuse of Company Assets Misuse of Company Assets Confidential codes Confidential codes Employee Theft Employee Theft
LEGAL & ETHICAL BEHAVIOR IN RETAILING In view of the competitive nature and dynamic environment within which retail operates, it is important to monitor the legal and ethical constraints affecting the sector (Dunne and Lusch, 1999, pp.176). In view of the competitive nature and dynamic environment within which retail operates, it is important to monitor the legal and ethical constraints affecting the sector (Dunne and Lusch, 1999, pp.176).
LEGAL & ETHICAL BEHAVIOR IN RETAILING Major Federal Laws Major Federal Laws Pricing constraints Pricing constraints Promotional constraints Promotional constraints Product constraints Product constraints Channel constraints Channel constraints (see Dunne and Lusch, 1999, pp.177).
LEGAL AND ETHICAL BEHAVIOR IN RETAILING Other Federal Laws Other Federal Laws Mergers/Acquisitions Mergers/Acquisitions Trade Agreements Trade Agreements Human Resources Human Resources Taxes and SEC (Securities & Exchange Commission) regulations Taxes and SEC (Securities & Exchange Commission) regulations Americans with Disabilities Americans with Disabilities
LEGAL AND ETHICAL BEHAVIOR IN RETAILING State and Local Laws State and Local Laws Zoning Zoning Unfair Trade Practices Unfair Trade Practices Building Codes Building Codes Blue Laws Blue Laws Franchise Laws Franchise Laws Green River Ordinances Green River Ordinances State Licences State Licences
LEGAL AND ETHICAL BEHAVIOR IN RETAILING Ethical Behavior Ethical Behavior Buying Merchandise Buying Merchandise Selling Merchandise Selling Merchandise Retailer Employee – Relationship Retailer Employee – Relationship
PRICING CONSTRAINTS Horizontal price fixing Horizontal price fixing This occurs when a group of competing retailers (or other channel members, i.e. within the horizontal or vertical distribution levels) establishes a fixed price at which to sell certain offerings. This occurs when a group of competing retailers (or other channel members, i.e. within the horizontal or vertical distribution levels) establishes a fixed price at which to sell certain offerings.
PRICING CONSTRAINTS Vertical price fixing Vertical price fixing This occurs when a retailer collaborates with the manufacturer or wholesaler to resell an item at an agreed-on price. This occurs when a retailer collaborates with the manufacturer or wholesaler to resell an item at an agreed-on price.
PRICING CONSTRAINTS Deceptive pricing Deceptive pricing This occurs when a misleading price is used (usually through direct marketing etc.) to lure customers into the store. This occurs when a misleading price is used (usually through direct marketing etc.) to lure customers into the store. Usually there are hidden charges or even an item may not be available. Usually there are hidden charges or even an item may not be available. Mr. Edward Heath (former British PM and the incident of winning a lottery). Mr. Edward Heath (former British PM and the incident of winning a lottery).
PRICING CONSTRAINTS Predatory pricing Predatory pricing This occurs when a retail chain charges different prices in different geographic areas (e.g. another state) to eliminate/fight competition in that state. This occurs when a retail chain charges different prices in different geographic areas (e.g. another state) to eliminate/fight competition in that state. The case of prices of goods in New York and DC (e.g. Sears, Macys etc.). The case of prices of goods in New York and DC (e.g. Sears, Macys etc.).
PROMOTIONAL CONSTRAINTS Retail promotion decisions are constrained by two major pieces of federal legislation (a) the FTC Act and (b) the Wheeler-Lea Amendment. These are meant to prevent unfair trade practices. Retail promotion decisions are constrained by two major pieces of federal legislation (a) the FTC Act and (b) the Wheeler-Lea Amendment. These are meant to prevent unfair trade practices. These refer to deceitful diversion of patronage (falsehoods about other competitors), deceptive advertising, and deceptive sales practices. These refer to deceitful diversion of patronage (falsehoods about other competitors), deceptive advertising, and deceptive sales practices.