In my classmate, Devin Spence’s post, he argues that Nestle had and may still have a role in child labour. He points out that it use to generate “11.8 billion Canadian dollars in net profit and is fully aware of the child slaves they employ.” Then, in 2002 Nestle’s CEO signed International Cocoa Initiative, which is dedicated to reduce child trafficking and abusive labour practices in West Africa. Devin questions if it is still involved in child labour since their is no actual evidence stating so.

In my opinion, Devin does put forward an interesting point, but this accusation relies too much on belief rather than fact. The law states, ” You are innocent until proven guilty”; therefore, one cannot immediately assume that Nestle is employing child slaves, for all we know it may be fighting this crime. After all, the fact that it signed they signed the Cocoa Initiative is evidence that Nestle proves this point. In conclusion, Nestle may be still doing so, but until evidence proves it is hiring child slaves, we cannot make such assumptions.

I agree to some extent with my classmate Cam Davis’s argument in his post: Exxon Valdez Oil Spill ::: An Ethical Dilemma.  After Exxon Valdez crashed in 1989, spilling 53 million gallons of oil in the Prince William Sound, many people demanded that some sort of compensation be paid for the damage it caused. It’s owner, exxon mobil, later decided to pay roughly 2 billion dollars to clean up the spill. Cam argues that no amount of money will account for the damages caused by the crash, saying ” you can’t put a price on an ecosystem.”

In my opinion, it is true that no matter how much cash Exxon Mobil pays to make up for the spill, their is will always be a certain amount of permanent damage; For example, deaths of wildlife or severe contamination of eco-system. On the other hand, we must understand that their is no possible way for them to account for permanent damage, and Exxon mobil has paid a large sum to refine Prince William Sound. Although the spill has inflicted some everlasting damage to the environment and wildlife, Exxon Mobil has done enough to make up for it. 

In Maggie Hendricks blog post, she explains Zuffa’s acquirement of MMA company Strike force. She points out that Zuffa made this purchase to further their goal to eliminate all of competitors in the MMA industry. Furthermore, this is it’s third company acquisition since the world-renounced Pride Fighting Championship. Maggie does not say wether this was a good move on Zuffa’s part, but she does state, “that it’s a definite game changer.”

Although Maggie’s point that only time will tell if Zuffa made a good decision is true, I believe that it will be definitely be beneficial to it. To clarify, Strikeforce was the UFC’s (MMA company owned by Zuffa) only real threat in terms of fan base. Also, Strikeforce owned one of the elite pound-for-pound fighters: Nick Diaz^1, Zuffa is now in control of his contract. Therefore, it now basicly owns all Pound-For-Pound fighters and the top four MMA companies. Moreover, MMA is a constantly growing sport which is gaining immediate fame worldwide. For example, for MMA event: UFC 137, their where 280,000 pay-per view sales. Their is little possibility that Zuffa will be affected negatively from it’s acquirement of Strike force.

Footnotes: Pound-For-Pound: MMA FIghters, http://fighting-mma.com/top10/pound-4-pound.php

H.J. Heinz Company is the creator of the world renounced Heinz ketchup, Ore-Ida frozen potatoes and other packaged foods^1. In 2011, it’s profits fell from 251.4 million in to 237 million due to “struggling developed markets such as United States and Europe”^2. In response, Heinz is cutting product prices and shifting its focus towards emerging markets (Russia, Turkey, etc.). These tactics will be funded through sizeable decreases in company size; So far, Heinz has closed 80 plants and shed 1000 jobs worldwide. How will such internal and external changes affect Heinz’s profits?

From an internal standpoint, a reduction in it’s number of employees and plants are great tactics for increasing profits. To clarify, the reduced company size will shrink Heinz’s costs. Therefore, it is equating it’s lower sales for cost deductions. Furthermore, Heinz should not focus completely on developing countries; if too much money is invested in such areas, it could see even greater profit losses because of higher costs. Instead, Heinz should decrease costs in order to become more profitable in developed countries.

Footnotes:

^1- Heinz website, Our Company, http://www.heinz.com/our-company.aspx

^2- Heinz squeezed by new economic realities, Nov. 18, 2011, Sarah Skidmore, http://www.theglobeandmail.com/globe-investor/heinz-squeezed-by-new-economic-realities/article2240902/

Apple Inc. is an international company that designs, manufactures and markets personal computers, computer software and other electronics^1. In fact, it is the largest technology company in the world^2. Apple employees credit this success to the superior performance and features of it’s products ^3. On the contrary, skeptics claim that this is not the case; better options are available for cheaper prices^4. Which forms the question, why do people choose to purchase from Apple if superior products are available for lower prices?

The answer is simple; Apple has prevailing brand positioning. As we learned in class, brand positioning is how a brand captures a position in the consumer mind. Apple has created a strong sense of simplicity through their design and marketing^3. Customers feel as if they are pursuing a simplistic lifestyle through purchasing Apple commodities. Basically, achieving this lifestyle is an incentive for people to buy it’s products. Apple’s technology is not the source of their accomplishments, their brand positioning is.

Footnotes:

^1- Apple Inc. Overview: http://www.webcitation.org/query?id=1257008017205735

^2-Apple Passes Microsoft as World’s Largest Tech Company, May 26, 2010, Dylan Tweney: http://www.wired.com/epicenter/2010/05/apple-passes-microsoft/

^3- Apple website, Why Mac? http://www.apple.com/why-mac/

^4-Apple: It’s All about the Brand, February 2004, Leander Kahney, http://www.wired.com/gadgets/mac/commentary/cultofmac/2002/12/56677

H.U.M.A.N. Healthy Vending is a nutritional company that “places premium healthy vending automated retail machines across the globe”^1. It is a perfect example of entrepreneurial business.

One of their vending machines

Sean Kelly, owner, made H.U.M.A.N. after noticing that few or no vending machines offered healthy food or drinks. He created a vending machine that not only includes healthy options for people, but is eco-friendly as well; they include “LED lights, take credit and debit cards, and a display at the top shows information on the healthy foods it serves” ^2. Like most entrepreneurs, Kelly has and still is facing a high-risk level. For example, he created FitFuel in 2007 which was similar to H.U.M.A.N. and it quickly went “bust” ^2. From 2009 to May, 2011, Kelly sold 500 vending machines and he plans to double this by the end of 2011. Such rapid growth is a major characteristic of entrepreneurial companies. It’s features such as innovation, high-risk level and rapid growth exposes that H.U.M.A.N. is a perfect example of an entrepreneurial company.
Footnotes:

^1- H.U.M.A.N. Healthy Vending website, Home, What is H.U.M.A.N. Healthy Vending? http://www.healthyvending.com/?split=1

^2- Jason Daley, How H.U.M.A.N. Is Breaking Through As the Next-Generation Snack Machine: My 24, 2011. http://www.entrepreneur.com/article/219671

Burger king is an international chain of fast food restaurants. It is one of the most prominent fast food restaurants, with over 11.4 million customers daily. Furthermore, it decided to open it’s first outlet in Russia^1. Which makes me wonder, will Burger King prosper in the Russian fast food industry?

Russian Burger King Poster

Burger King’s main competitor, McDonalds, has had great success in Russia; it went from having 1 shop in 1990 to 235 currently^2. Although this may seem like a threat since McDonalds is Burger Kings rival, it is also an opportunity. Burger King and McDonalds have similar business plans and target markets, plus, they both have prodigious success in the same market (North America) for many years. Therefore, the fact that McDonalds has had such achievement in Russia signifies that Burger King can do so as well.

Footnotes:

^1- RIA Novosti, 10/01/21, http://en.rian.ru/russia/20100121/157640260.html

^2- USA Today, 10/01/21, http://www.usatoday.com/money/industries/food/2010-01-21-russianburgerking_N.htm

Ryanair is an Irish airline that gained worldwide recognition through it’s unmatchable low prices^1. In fact, Ryanair offers flights that are two to three times less expensive than other airlines. On the other hand, it charges its customers with hidden fees and services to increase revenue^2.  Which raises an interesting question, although Ryanair is not acting illegally, are its procedures and business plan unethical.

Ryanair receives revenue through hidden fees

In short, Ryanair’s hidden fees are definitely unethical. For instance, if a customer does not check-in online, they are charged a fee. Also, if customers do not use a certain type of credit card, they are charged again^3. Ryanair’s business strategy consists of various small charges that are hidden behind their “low priced tickets”. Therefore, a business should aim to increase total revenue, but Ryanair is doing so unethically, which could eminently damage their image and costumer base.

Footnotes:

^1- Ryanair website, About us, http://www.ryanair.com/ie/about

^2- Cheap Ryanair Flights, http://airfare.bootsnall.com/airlines/ryanair-flights.html

^3- Anna Tims, The Guardian, 08/02/01, Guarhttp://www.guardian.co.uk/money/2008/feb/01/consumeraffairs.ryanair

The National Basketball Association is a prominent men’s professional basketball league, with over 5.5 million viewers during the 2011 final game^1. Unfortunately, immediately after the final game, the NBA players and owners began disputing on player salaries. The purpose of this disagreement is that the team owners want to make a decrease in the player salaries, but the players are unwilling to give up the asked amount^2. After several meetings, the NBA’s commissioner and representatives have decided to pursue a lockout, having many questions it’s future. As a result, are NBA players being intelligent by not accepting a lower salary, or just stubborn?

First, the salary decrease is quite reasonable because it will not substantially affect the player’s income. In 2011, the players would receive 57% of the total revenue made through the NBA. The team owners want to decrease this to 54%; a decrease of 3% in player incomes^3. Therefore, the salary cap for each team will drop from 58 million to 56.42 million dollars^3. Furthermore, It seems that the Owners have no intention on reconsidering their decision; consequently, the players will have no job at all if they do not accept the proposed incomes.

The NBA is in a lockout.

Footnotes:

^1- Bill Gorman, 11/05/27, http://tvbythenumbers.zap2it.com/2011/05/27/2011-nba-playoffs-on-tnt-average-5-5-million-viewers-most-watched-in-cable-television-history/94080/

^2-Sid Chadha, 11/09/22, NBA Lockout Overview, http://gotsportsblog.com/nba-lockout-overview/

^3- NBA News, Official NBA website, 11/10/09, http://www.nba.com/home/index.html

The Netflix logo

Netflix Inc. is an online video rental and movie streaming company based out of the United States^1. In fact, it is the largest company in the online media streaming industry with over 8 million subscribers worldwide^2.

Due to Netflix’s international success, it has decided to make dramatic price increases (as much as 60%). This choice is really testing the company’s customer loyalty and price elasticity^3. Which raises an interesting question; how will Netflix’s current customers respond to its increase in prices?

The answer is simple, they will unsubscribe to Netflix. Although it has over 8 million loyal subscribers, there are several substitutes for Netflix. For example, video rental stores, other online media companies, Video on Demand, etc. In today’s feeble economy, most people will decide to purchase these options over Netflix to save money.  Therefore, Netflix has a large price elasticity because their will be a decrease in demand for it when it’s prices increase. In other words, an increase in price results in a decrease in demand. As a result, Netflix’s rise in rates will likely result in a considerable loss in its clientele.

Footnotes:

^1- Netflix: Overview, http://ir.netflix.com/

^2-Netflix-Company Information, http://venturebeatprofiles.com/company/profile/netflix

^3- Rob Frieden, Netflix Tests Subscribers Price Elasticity and Loyalty, http://telefrieden.blogspot.com/2011/07/netflix-tests-subscribers-price.html