Should becoming a sustainable business be a priority and goal of a business? Does the cost outweigh the benefits?  In our modern day and age we are entering a new stage of eco-friendly solutions; which means that more and more customers are expecting businesses and corporations to do its part to aid in reducing its impact and footprint on the earth.  According to the National Marketing Institute (Sustainable stats and information) consumers are willing to pay up to 20% more on a product if they no both the business and product are eco-friendly.  So maybe we as a business can take advantage of this opportunity and actually boost profits by becoming “green.” In becoming a more sustainable business there is definitely an upfront cost to change to a greener production line and costs to maintain it as such.  However, having the chance to increase profits by 20% can make this change worthwhile.  Ernst and Young believes that in the near future governments will institute different laws requiring businesses to reduce its carbon footprint by up to 25% by 2020.  So turning into a greener company may not even be a choice soon…

Since the economic troubles in 2008 car companies saw a major decline in the demand for vehicles.  Now, 3 years later we see the exact opposite happening.  There is a huge demand for cars and the manufactures can’t keep up with the orders, so many customers have cars on backorder.  (Globe and Mail) Honda has seen this and is reacting accordingly by boosting

 production.  Just as it were boosting production, the Tsunami hit Japan; as a result parts and cars were swept away and the entire supply chain was disrupted.  As a wise decision they shifted there manufacturing base and thus changing the supply chain to make it more effective for producing the cars.  This is a very smart decision; instead of trying to salvage the Japanese supply chain it has simply shifted all its resources to Canada, saving them

money and time. Now in an effort to catch up with all the orders and cars lost, the Canadian plants will be producing overtime 6 days a week. Although Honda is paying its employees overtime, a slightly larger cost than usual, the benefits out weigh the costs.

How do we define the success of a company? Is it how much their assets are worth?  How many different countries they occupy? I think they kind of go hand in hand; it’s somewhat difficult to expand a company into several different countries if you don’t have the assets or the money.  Is it worth expanding though? There is a big risk that comes with it, more competition, unknown market, and depending where you are, unstable government.

Recently a Canadian company called Teck Resources, a mining company that made the Olympic medals for the 2010 Vancouver Olympics, was seeking to expand to Namibia, Africa where there is huge potential for minerals to mine.  The labour would be cheap and the investment return would be great.  So why is the company sitting idle on this opportunity?  The government.  The government is highly unstable in Namibia.  The government just incurred a large debt and the first thing they did was impose an extra 40% tax on mining companies in the country.  So even though money can be made, a new government tax can take away all profits from this investment.  So much consideration must be made to where a company expands, because it’s not always a good move….

As we go through economic ups and downs we see more and more companies merging together to produce one stronger company that can withstand more in the changing economy.  Not only does the company become stronger, it is also able to seize opportunities through a recession that it wouldn’t have been able to afford before, both in risk and in monetary funds.  According to business BC magazine the number of corporations that are merging now are nearly triple what they have done in previous years.  This isn’t just due to the recession though; merging numbers have been growing exponentially since the 1990s.

However there are many things a company must consider before merging.  What is the risk?  What are the benefits?  Several other points must be thought out before making a choice.  Funnily enough one of the biggest problems merging companies have is a new name and logo! Some just keep one of the older company’s name and logo and stay under that title while others create a whole new logo.  It’s quite interesting what they develop.

Is there a limit to what we should use as Marketing? I saw this add the other day and it made me think of the power of marketing and branding.  This is a personal safe designed for personal firearms with the slogan “the first line of defense is you ” so there is quite an insinuation in the slogan by Sentry Safe.  It seems as if they are saying should there be an intrusion of some sort in your home, you should go grab your gun because this particular safe is quiet and quick to open because “the first line of defence is you.” Have we not been taught throughout our whole lives to call the police? Call 911?  Although it does take the police time to get there is taking the law into your own hands the right choice?  Regardless of which you think is right, this add makes you think of safety in your home and ultimately that’s what everyone wants, a safe house.  So it really makes the consumer look at the options at hand. Great , powerful brand marketing.

After reading about this I had a good chuckle to myself. Recently Netflix changed their service and jacked up their prices with little to no warning for their customers.  Quite naturally there was a very negative response from their customers who were very displeased with the situation, and as a result this corporation lost nearly 1.5 million customers and had their stock drop over 15% in a day.  This is a great example of what not to do, instead, keep your customers aware of your service and your decisions.   When you see something like this it really makes you wonder what other companies might do next.  It all leads to distrust and concern.  From a consumer point of view when they see actions like this they simply choose the competition over you because the buyer has power because there are other substitutes; ultimately customers choosing the competition over us is the last thing that we want to see.  So it’s much better to be honest with customers with the significant changes within a company and that will build customer loyalty.

A week after the change, they realized their mistake and the CEO made this post on their blog . (Netflix blog/ CEO apology)

 Today in class we discussed the importance of having ethical practices in a business.  As an example, we used Ikea not paying the same minimum wages in Europe as in the United States, which I found somewhat ridiculous.  First of all we overlook the fact that they are employing Europeans and Americans as well as contributing to their economies opposed to having furniture manufacturing in India or China and employing people for 50 cents a day.  This should be noted as a very respectable attribute of the Ikea Corporation.  Secondly how can you expect to pay minimum wage in Europe and pay that same minimum wage in America, which is substantially higher.  It’s as ridiculous as asking why the CEO and new guy at the till don’t get paid as much, because it’s completely different!  The economy and lifestyle in Europe and America is incomparable.  In Europe housing costs more, food costs more, gas costs more, almost everything is more expensive in Europe, and thus the minimum wage is higher.  So before we critic a company for employing people in a different economic circles and paying a different wage we should look at other companies like nike first.