A reporting from New York Times states General Electric, a multi-billion-dollar firm, had paid zero taxes to the US government in 2010 because the tax department base financials decision on tax deductions and loopholes.  General Electric, however, has overlooked on how much is actually saved from these decisions because millions of dollars is spent on how to avoid taxes when this can be spent on improving the overall value proposition of the company, such as products development.  Marginal Revolution, an external blog, points out that the New York Times based their calculations of profits according to GAAP instead of IRS which then casts doubts on its analysis of General Electric.

The blog user explains difficult concepts and business terms thoroughly which I thought was useful when understanding the situation.  This is an interesting blog post because it is surprising what kind of actions a multi-billion dollar company take on just to dodge away from paying taxes.

As a consumer point of view, even if the New York Times calculates according to IRS, the negative news about General Electric avoiding taxes may consequently lose customer loyalty on its brand because one may question on the business’ ethics.

Innovation has yet again proven to surprise us! From Chelsia’s blog, she discusses the first gold vending machine introduced on the popular Wangfujing Street of China. Due to gold prices constant skyrocketing, there is a demand for this commodity and creates a solid investment to consumers.  To accommodate for this demand, gold vending machines will convenient consumers’ accessibility to purchasing with acceptance to direct cash and bankcard.  After reading the article, I became concerned about whether this invention will change consumer’s value on gold.  Since typical vending machines dispense snacks and miscellaneous items and usually socially overlooked upon and now, by introducing gold to be dispensed from these machines, the value of gold seems to be in question.  My question is whether will this invention have positive or negative effects on the demand for gold.

Micro-finance,an idea proposed by Muhmmad Yunus, a Noble Prize-winning Bangladeshi economist, is to act as a social business solution in developing countries.  However, when decisions about how the poor should receive financial support plunged the microfinance industry into a crisis.  The concerns revolved around the question whether there was a need for a reliance from modern financial institution’s assistance (raise the funding in capital markets) , or support from non-profit sources. C.K. Prahalad, an Indian management guru, suggested that the poor should start up their own business to yield healthy profits, which then can also satisfy shareholders while promoting social development. In great surprise, Bangladesh’s Grameen Bank, which depends largely on donor grants and sustainable repayments, have not been affected from any of these problems.  As a result to the crisis, it has lead to Dr. Yunus’ ouster. It is to one’s wonder whether microfinance is a social sustainable solution since it also brings about to many political conflicts.

According to Angus Todd’s It’s the right time for Coffee, he addresses McDonald’s aggressive marketing campaign of giving away free coffee (about 60 million cups to date) as a wise marketing decision for the company to gain valuable market share. He also addresses Starbucks’ powerful campaign about the necessity of quality over cost and how this company may control a large segment of the market.  Due to the recent economic downturn, however, this has became a setback for Starbuck since their customers’ loyalty shows to decline.  I agree with Angus’ reasoning of how McDonald’s new products have created a competitive edge in the coffee industry.   The economical state has provided an incentive for consumers to seek for a coffee house that offers a welcoming atmosphere while charging for less.  I believe, McDonald has successfully merged into the coffee industry at the right moment to gain its hopeful amount of market share.  Overall, does this marketing decision demonstrates that the majority of consumers value the price of a product more than the quality?

https://www.youtube.com/watch?v=hbV6qsWEESw

Bill Bowerman, the co-founder of Nike, envisions endless human potential possibilities in sports and integrates the idea onto the company’s culture which successfully influences consumers’  value to incorporate Nike as apart of a life, “Nike Attitude”, instead of just a product line.  Over the last two decades, Nike has expanded global recognitions and diversified products to create new markets and new demands. With such expansion, the company has altered production and organization methods.  In 1999, Nike began selling products directly to consumers via its website and allocating resources to manufacture products at minimum cost.  Recently, Nike, as a leading company, takes social responsible initiatives by promoting a new sustainable line, Nike Considered,which reduces waste consumption during the manufacturing process. In my opinion, Nike is considered to be an entrepreneurial company through its innovate progression of a small company to a globalized well-known company we know today.