In supermarkets, I always observe consumers participating in a careful procedure when selecting their produce.  For example, at the oranges section, consumers thoroughly scanned the entire and all its dimensions to find the “perfect” candidates.  Then, they would pick one up, toss it lightly, and feel its overall “weight” and the “thinness” of its skin.  If all those standards were met, the orange earned a spot in the bag.

In response to Cecile Ouillet’s blog post The Success of the Inglorious Fruits and Vegetables, it is not criminal to pick the perfect fruit, although slightly selfish.  Since consumers are fully entitled to spend their money based on goods they value most, I feel that consumers are justified to pick the items they believe are the best.   Consumers choose specific goods because they believe their purchases will benefit them in some ways.  This idea of “value” or “how much a good is worth” to a consumer brings us to the idea of consumer surplus.  Increase in consumer surplus leads to an increase in total surplus and economic welfare; thus increasing efficiency overall which benefits society in general.

On the other hand, sustainability must not be forgotten.  Aside from appearance, if the fruit or vegetable meets regulation and taste standards, I feel that consumers should consider “not to judge a book by its cover”.  As global citizens, consumers need to take into consideration the immense amount of waste they would create if each consumer only picked the best when they made their decisions.

Recently, the surging trend of companies partaking in environmental and social initiatives has sparked much skepticism.  I am doubtful if their true intent is to honestly change the world or rather to rebrand their image to become “clean” of blame.  Since corporate giants are obsessed with maximizing profit, it is hard to understand why they would break their greed addiction to allocate funds for global causes.  It doesn’t sound right.

With Class 15: CSR and Sustainability fresh in mind, Ben and Jerry’s has changed my perspective by spearheading its company with the core value “linked prosperity” among customers, employees, and suppliers.  From introducing fair trade flavours, to launching Ben and Jerry’s Foundation, to assisting local farms achieve their sustainable goals, Ben and Jerry has redesigned each part of its supply chain to uphold its position as an ambassador of social, economic, and environmental change.  Recently, Ben and Jerry’s recently partnered with NativeEnergy to help Green Dream Farm reduce its greenhouse gas and waste products by installing separation equipment.

Today, I have noticed that consumers’ biggest dilemma over a products is between their want and their conscience.  It is naturally uncontrollable to want something, but difficult to differentiate if it deserves one’s money.  Personally, I prefer companies with integrity than popularity.  Even if a product is the new trending fashion, I can never bear the gut feeling of supporting a company without ethical means.  I cannot submit to the status quo without knowing the true story behind.

Risk is a significant factor that businesses wish to eliminate (although impossible) if not reduce to a minimum.  Just Cookin, a small diner in Dallas has boldly decided to remove all prices off their menus!  Owner Dana Parris claims to have strong faith in God and her customers to pay what they believe the food deserves.  RISKY?  Although “revenues tripled in the first week”, its sustainability is highly questionable.  A week’s time to judge the feasibility of this strategy is simply not enough.

Increasing customer power by employing this strategy during holidays or long weekends can definitely be a practicable strategy, an attractive means of marketing, and a way to earn a little more.  However, in the long run, this tactic brings insecurity.  Business itself is already a gamble; hence owners need stability not uncertainty.  Let us consider the consistency of consumers’ payments.  Will customers pay reasonably every time based on their conscience?  People are obligated to pay less if one day’s food is below their standards.  It is easy for them to keep raising their standards and use it as an excuse to pay less each time.  It is also a matter of abiding to business ethics or cheating the system by paying nothing completely.  This may not be the case, but it is crucial to take all precautions and be a little pessimistic when analyzing risks and making decisions.

Ambitious energy project proposals such as the LNG and Site C mega projects have sparked mixed frenzies among Canadians and First Nation groups. Undoubtedly, these ambitious proposals has excited both provincial and federal governments with its golden opportunities for Canada’s future.  However, these projects unquestionably pose another habitual threat among our environmentalists: First Nation groups.

Undoubtedly, battles between the maximization Canada’s potential wealth and the protection of our pure environment will never cease.  How should we strike the balance?  Will governments and First Nations achieve consensus?  How can the government guarantee minimal disturbance among Aboriginals or how can First Nation groups yield and compromise?  Is this more than an environmental concern or a struggle for power?  These questions are the culprits of constant arguments between both parties.

With extended discoveries of natural gas in BC, the LNG project is a huge benefactor to the Canadian economy.  With the loonie plunging to $0.8996 USD, Canada’s economy has been stalled with zero growth as of July 2014 while the American economy continues to surge.  The LNG and Site C projects abounds with golden opportunities for Canada in countless respects.  These projects are pillars to strengthening our nation itself, trade and relations with countries, reinforcing Canadian presence in Asian markets in particular, and growing to be a world-class exporter of clean and economical natural gas.

Every decision is replete with opportunity costs, but who calls the final shots?  The existing government or the true inhabitants of “Kanata”?

Image: WestJet vs. Air Canada

Recently, WestJet announced its new route from Halifax to Glasgow effective May 29, 2015.  This announcement complements our Class 9: Management Accounting discussion and the debating question from this Class 9 preparation article.  Since WestJet is expanding its flight destinations, an investment of bigger planes is quite feasible.

WestJet’s main competitor among Canadians is unquestionably Air Canada (AC).  In terms of comfort, AC undoubtedly reigns over WestJet with its new, spacious aircrafts.  However, AC’s package includes two connecting flights to reach Glasgow starting from $908 (round trip) while WestJet proposes a direct flight with a considerably attractive price of $259 (one-way fee).  These aspects are pending opportunity costs that travellers need to earnestly consider.

The real question is: are WestJet’s current planes suitable for the 5 hour 15 minutes flight?  If WestJet remains a loyal ambassador of the Boeing New Generation 737 series, they will be exposed to greater risk.  Indeed its low prices attract consumers, but the uncomfortable idea of limited leg and isle space can repel customers.  Apart from its low cost, WestJet’s “direct flight” offer is a prominent convenience to travellers as it reduces hassle and guarantees efficiency.  However, WestJet cannot rely solely on these two strengths to achieve of success forever.  As we discussed strategy in Class 7, WestJet needs to realize the ease for its competitors to offer the same services.  WestJet can no longer propel its company based on “sustainable competitive advantages” but rather explore transient competitive advantages.  Investing in larger planes is only the beginning step.