Case 5 Nau!

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2. Will Nau’s approach have a limited appeal, or do you think it has staying power? What drawbacks might there be to what Nau is doing? This approach has extra costs involved, that means that in hard economic times Nau has a limited appeal, because the population would rather choose the cheaper product. Although, the company also saves money by the inventory for instance. As mentioned in the case, they do not need a large storage room, because of the “Web-front” concept. Studies appear to show a positive relationship between social involvement and the economic performance of firms. So in the times when the economy is down, it has a limited appeal for customers, but in the long-run Nau will have staying power. The drawbacks might be:

* They won’t be able to maximize their profits
* The extra costs involved
* Lack of skills
* lack of accountability

4. Are there lessons here for other businesses? Discuss.
There are certainly lessons here for other businesses. First of all, companies pollute the environment a lot. Some examples are:

* Air, water, and soil pollution from toxic wastes
* Global warming from greenhouse gas emissions
* Natural resource depletion

The government has to make regulation, because most of the companies don’t clean up their mess. But when companies have social responsibility the government don’t have to do that. After some experience innovations will occur to produce cheap and “clean”. There will also exist a fair competition, all the companies have the same approach and produce it in the same way.
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