International Business
1. Is it legitimate for an enterprise like Wal-Mart to demand that its suppliers adhere to a code of ethics? What are the benefits of this practice to Wal-Mart? What are the costs?
Wal-Mart built its rise to dominance on everyday low prices. In order to be able to deliver cheap products to customers, it was forced to source many of those products from plants located in under developed countries. Working conditions in these counties are complicated and poor and workers seriously suffer during the production process. The willingness of Wal-Mart to fight with the abusive system, in which these plants produce their products that we can see on Wal-Mart shelves, is an example of ethical way of doing business. If all shopping chains would adhere to a code of ethic in that way, it would really make a difference in the world.
The benefit is that Wal-Mart is a place where people can do their shopping and be sure, they are buying stuff manufactured at plants where working conditions are about its national legal standard. It may be Wal-Mart’s advantage in the competition on the market. The cost of being sourced from plans with better working conditions for workers is that it cost some money to perform all the audits and teach those plans how to make its production process more effective instead of paying less to its workers. It may rise prices of products and Wal-Mart must be looking for another ways how make the price reasonable for customers.
2. Wal-Mart is known for constantly demanding the very lowest prices from its suppliers. How might this impact upon ethical behaviour at its suppliers?
The impact upon ethical behaviour at its supplier is that some of them try to fake their number of hours their workers worked for, the number of overtime hours, how much they are paid (trying to show that workers are getting at least the minimum salary, which is not truth).
Some of them also hired an adviser, who teach them what questions they will be asked and what is
Wal-Mart built its rise to dominance on everyday low prices. In order to be able to deliver cheap products to customers, it was forced to source many of those products from plants located in under developed countries. Working conditions in these counties are complicated and poor and workers seriously suffer during the production process. The willingness of Wal-Mart to fight with the abusive system, in which these plants produce their products that we can see on Wal-Mart shelves, is an example of ethical way of doing business. If all shopping chains would adhere to a code of ethic in that way, it would really make a difference in the world.
The benefit is that Wal-Mart is a place where people can do their shopping and be sure, they are buying stuff manufactured at plants where working conditions are about its national legal standard. It may be Wal-Mart’s advantage in the competition on the market. The cost of being sourced from plans with better working conditions for workers is that it cost some money to perform all the audits and teach those plans how to make its production process more effective instead of paying less to its workers. It may rise prices of products and Wal-Mart must be looking for another ways how make the price reasonable for customers.
2. Wal-Mart is known for constantly demanding the very lowest prices from its suppliers. How might this impact upon ethical behaviour at its suppliers?
The impact upon ethical behaviour at its supplier is that some of them try to fake their number of hours their workers worked for, the number of overtime hours, how much they are paid (trying to show that workers are getting at least the minimum salary, which is not truth).
Some of them also hired an adviser, who teach them what questions they will be asked and what is