Introduction
It is essential to emphasize that poor people should also be allowed to buy goods. From an ethical point of view, such business activities can bring certain benefits to customers (Case 3, 2023). Accordingly, the critical arguments in favor of business development and the sale of goods in low-income countries are the economic advantages for individuals. Consequently, companies that enter the market create a production facility in the country or a warehouse that creates jobs for its residents (Prahalad & Hammond, 2002).
Furthermore, the ethics of a decision should be justified by the positive impact on the population, and the sale of goods and services can accumulate money in the state budget and be used to develop communities, schools, and hospitals. Customer preferences are the following arguments confirming the ethics of selling goods to poor consumers. That is, increased competition leads to lower product prices, which improves people’s purchasing power, and people can buy goods that will enhance their lives and implement new technologies (Prahalad & Hammond, 2002). As a result, poor people receive not only pleasure but also real value from purchasing commodities. Therefore, it is ethical to distribute products to poor consumers.
Economic Advantages
Significantly, private investment is a tool to enhance the overall economic performance of poor regions. Businesses that enter new markets become involved in the economic system and create new jobs (Prahalad & Hammond, 2002). Accordingly, in developing countries, there is a problem of insufficient jobs for a large part of the population, which leads to them living below the poverty line. Moreover, corruption, political instability, and excessive bureaucratic red tape prevent poor countries from creating jobs independently (Prahalad and Hammond, 2002, Serving the world’s poor, 2023).
Therefore, foreign businesses’ access to low-income countries’ economies can provide an impetus for economic growth. Even from the point of view of corporate and social responsibility theory, it is essential that a business is profitable, legal, and supports society; then, it is considered ethical (Lecture 2: CSR Theories. CSR and Business Ethics, 2023). Consequently, it is ethical to sell goods to poorer consumers because the business operates in their environment, creates new workplaces in the region, and provides ordinary residents with better incomes and quality goods and services.
Meanwhile, ethical business decisions should be based on the main positive factors for the population. For instance, Siemens encouraged bribery in the industry to achieve its interests (Case 5, 2023). Instead, the ethicality of certain decisions will have to be assessed by factors such as managerial influence and business behavior (Trevino, 1986). Consequently, if a business does not stimulate the emergence of negative phenomena in society, it can be considered ethical. For example, if the supply chain is organized to include developing countries, it will allow them to benefit from tax revenues (Lecture 10: CSR and Business Ethics. Suppliers, 2023).
Accordingly, the distribution of goods and services in poor countries is also taxed, which brings additional funds to the state budget. In addition, starting a business in developing countries encourages business owners to build the region and attract investments from various charitable organizations to enhance people’s living standards (Banerjee & Jackson, 2017). Thus, such actions increase income-generating activities, reduce poverty, empower people, and improve their access to healthcare and education. As a result, selling goods in poor regions is ethical, as it generates revenue for the budget and attracts assistance from charitable organizations to develop vulnerable communities.
Consumer Benefits
Business involvement in an environment with poor consumers has competitive advantages for them. It is considered unethical for a business to provide inaccurate advertising, inferior quality goods, or overpriced products (Lecture 8: Consumers, CSR and Business Ethics, 2023). Accordingly, if different companies enter the market, the quality of consumer services will immediately improve.
For example, Coca-Cola entered the Indian market in 2023 with a strategy of accessibility at a low price. Thus, consumers still bought the drink despite the price per 1 bottle of Coca-Cola products being higher than the average market price in India (Karnani, 2005, p. 99). This is because the company provides a product that meets the advertised characteristics and has a high-quality composition. Consequently, even people who do not have a significant income have the right to buy a quality product (Donaldson, 2008).
Therefore, it is not ethical to restrict consumers’ right to purchase such goods due to their insufficient financial capabilities. Kaler (1999) argues that ethical theories are designed to solve ethical problems. Hence, if increasing the diversity of expensive goods in the market of poor countries leads to the welfare of buyers, then it is ethical to sell these goods to poorer customers.
Many companies are already conducting profitable business in poor regions and states and are in demand by their residents. Although most people in poor countries earn less than $2000 annually, they buy various goods (Prahalad & Hammond, 2002, p. 7). Consequently, people have become accustomed to their living conditions and want to afford the benefits of civilization that are available to them. Therefore, selling expensive but necessary goods to make people’s lives easier is an ethical phenomenon (Lecture 4: Decision-Making and Business Ethics, 2023).
It is also worth noting the example of Airbnb; this service company entered the market with innovative services and allowed people to find shelter in well-known countries in people’s homes rather than in hotels. This experience became popular among tourists, who could freely interact with locals and learn exciting information (Case 8, 2023). Meanwhile, hotel revenues declined because Airbnb was much cheaper, which was also an advantage for tourists. In this case, hotels are not pursuing an ethical policy if people can get a better service for their money. Instead, in the case of poor people buying expensive but essential goods from poorer villages, this is an ethical practice because it fully satisfies their needs and improves their lives.
In addition, residents of poor societies are willing to adopt new technologies to change their lives. For example, women in Bangladesh use cell phones for work, and adolescents in Kenya use the Internet for education (Prahalad & Hammond, 2002). Hence, large companies can enter a new market to distribute mobile coverage or the Internet. Considering the popularity of this type of service, consumers in poor regions will pay for its expansion. Therefore, it is ethical to provide services to poor consumers that have significant benefits for them (Lecture 7: Shareholders, Corporations, and Social Responsibility, 2023).
Since investments in the development of the Internet will contribute to a better income for people, for example, using the mobile Internet, women can track where there are more fish in real-time (Prahalad & Hammond, 2002). Furthermore, investments for profit in rich countries can positively affect the development and preservation of the environment. For instance, Volkswagen was found guilty of unethical environmental practices in its operations (Case 4, 2023). However, companies can bring new technologies to underdeveloped countries and provide additional benefits such as environmental protection. Accordingly, such a decision is ethical and in line with the interests of consumers.
Conclusion
In summary, the decision to trade goods to poor consumers is ethically correct. Selling goods is a commercial activity, and consumers choose what goods they want. Consequently, if individuals from poor countries or regions decide to buy expensive goods, they consider that they need them. In addition, they evaluate the benefits they can get by acquiring the goods. As a result, their decision is based on the potential benefits of using the goods.
Thus, sellers can ethically offer their goods to different categories of people, and they will decide whether to create demand for them. Meanwhile, if marketers offer poor consumers an expensive product with cheaper counterparts, ethical doubts may arise about the company’s activities. Additionally, if vendors make claims about the characteristics of products and services that are not true, this is a violation of ethical principles and fair trade in general. In contrast, when sellers offer goods to poor customers and provide honest and open access to relevant data, people can decide whether they need them. Hence, selling goods to poor consumers is ethical if sellers guarantee that people benefit from their purchases.
Reference List
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