right from wrong.
If it is that easy,
then why don’t all
retail players act
ethically all the
The idea of retail ethics occasionally
pops into my head when
I read an ad that unfairly maligns
competitors or when I see an
online review of a retailer that
consumers have branded as
unethical. Also, when I pick up
any metropolitan newspaper,
and see ads touting “everything
50 percent off!,” I get to thinking
about transgressions of an ethical
code retailers should observe
and live by.
What Are Retail Ethics?
Wikipedia gives a rather ponderous
definition of “ethics” as
follows. “Ethics or moral philosophy
is a branch of philosophy
that involves systematizing,
defending, and recommending
concepts of right and wrong conduct.”
Expanding this definition,
retail ethical behavior might be
defined as, determining and pursuing
right or correct behavior in
a retail operation versus pursuing
wrong or evil behavior in the
Obviously, the definitions given
above are not a very helpful
guide to modeling ethical behavior.
Most mature, adult observers,
would say that they intuitively
know right from wrong. If it is
that easy, then why don’t all retail
players act ethically all the time?
Here is my guess. Aside from
basic human foibles such as vanity
and greed, the temptation to
work around the edges of ethical
behavior is driven by the problem
of competition. Every retail enterprise
has competition. You can
talk all you want about “cooperation”
between different stores
offering similar products and how
they should all get along. But, we
all know that this rarely, if ever,
happens in the real world. For
many, it is dog eat dog at retail.
Businesses in the United States
have flourished in a culture that
champions the idea of free enterprise,
which is the hallmark of
our commercial culture. It means
anybody, anywhere, and at any
time can open and operate pretty
much any business he or she
wants; take any associated personal
or financial risk, and rise or
fall solely on merit and initiative
(within the legal framework of
our society). Our free enterprise
system also depends on a large,
strong middle class, from which
both customers and entrepreneurs
So, which is correct?
Are business ethics born
more often out of
self-interest and fear of being swamped by
the competition, a desire
to do what's right, or
a bit of both?
This culture naturally breeds competition, often unfettered and ruthless.
In this competitive environment,
ethically-minded people recognize
the necessity of having a
complimentary code of ethics that
defines proper and fair conduct.
In our industry this would take
the form of a code of ethics for
operating a retail business in an
environment rife with competition.
Let’s digress for a moment and
consider an alternative, government
controlled system, where
free enterprise supposedly does
not exist. Would the retail code of
ethics be the same as in a capitalist
state? Probably not. In the days
of centrally planned, non-privatized
societies, retail business often
went underground or devolved to
use barter. My point is that ethical
business practices are affected
by the systems under which they
operate, and are not a standard
code of accepted behavior in
A Very Short History of Ethics
So, where did the idea of business
or retail ethics get started?
The late Professor Robert Lopez
made the following observation
concerning the origin of fair dealing
in the Middle Ages. In his
book “The Birth of Europe.” He
noted that during this time, trade
guilds took measures “to guarantee
quality and limit price." He
also observed that these rules
"sprang less from a regard for
honesty than the fear of antagonizing
A contrasting view is that most
people have an innate sense of
fair play as embodied in "The
Golden Rule" that suggests we
should treat others as we would
want to be treated. It's an idea
that probably goes back farther
than human memory.
So, which is correct? Are business
ethics born more often out
of self-interest and fear of being
swamped by the competition, a
desire to do what's right, or a bit
Laws Enforcing Ethics
Our legal system is active and
occasionally even aggressive in
policing good business behavior.
For the most part, laws have
been passed to protect consumers,
employees, the environment
and the broader society for good
When unfettered by rules, it
doesn’t take long for big dogs
to devour smaller dogs. Laws
have, therefore, been implemented
to stifle unfair business practices
from creating monopolies
or commercial oligarchies. While
we certainly have our share of
multi-billion dollar conglomerates,
the vast majority of business
concerns are still smaller and
There are many federal, state
and local laws against unfair,
deceptive and fraudulent business
practices, but there aren’t laws
for everything. That is probably
a good thing. At some point, the
role of ethics in business has to
find a place.
To Whom Are
for not only following laws, but
also an ethical responsibility to
our fellow citizens, especially in
areas where the law is not clearly
defined. This is especially true
for retailers, who depend on the
public trust for their livelihoods.
These responsibilities include
moral behavior toward:
- Shoppers and customers.
- Employees and contractors.
- Vendors, including furnishings
manufacturers and their
- Society, and the communities in which they operate.
Without going into the weeds
about ethical philosophy, the
province of weighty, unreadable
university text books, let us talk
about some specific issues of ethical
What Do Retailers
Owe Their Customers?
Certainly, customers should be
treated fairly. But, what is fair?
For example, Is it unethical or
unfair to set a price too high? My
guess is that any price that is out
of line with the “current market”
will be quickly exposed, and need
to be adjusted lower if the seller
wants to remain in business. Every
retailer must decide pricing levels
that make sense for their specific
operation. In my opinion, setting
an unusually high, out-of-marketrange
price is probably unwise,
but not unethical.
So, what do retailers owe to
- The first retail responsibility
is to simply live up to
the promises made to customers.
Some promise same-day delivery.
Some promise “always in stock”.
Not every retailer has the same
bundle of promises. But, whatever
the promise, ethics dictate that
those promises must be kept. It
isn’t illegal to promise same day
delivery, and then deliver three
weeks later. It may not even be
unethical, it may just be carelessness,
but it is bad behavior that
will ultimately cost you.
- The second responsibility
of a furniture or bedding
retailer is to be truthful in advertising,
promotion and sales presentations.
Since every customer
expects honesty from the stores he
or she buys from, it's an implied
promise every retailer makes to
Owe Their Employees
In our society, workers/employees
have freedom of action. No
one is bound to a job. Employees
may decide to stay employed or
leave. They are free to act in their
- Again, I think it is fairly
simple. Retailers owe
their employees what they have
promised. Many retail employees
work on commission. The distribution
of commissions earned
is controlled by the employer.
Some stores share commission
between employees, some have
other, more exotic commission
structures. The ethics violations
come when an employer cheats
the employee out of their commission.
This kind of illegality is
very difficult to nail down. But, it is
definitely unethical because it violates
the promise to the employee
of correct payment.
- Does the employer owe
good working conditions?
Good pay? Humane treatment?
Retirement benefits? Free lunch?
While these may be good ideas,
the failure of an employer to
offer some of these benefits, in
my opinion, may be a poor and
unwise choice, but not necessarily
an unethical one. Just like
a retailer's responsibility to the
customer, it is the ethical responsibility
of the employer to live up
to promises made to employees.
If workers were promised
free lunches, they should get free
lunches. Anything short of that is
unethical. If an employee feels
treated unethically or illegally, he
or she has the remedy of quitting,
filing suit and or airing his or her
Does an employer owe
good working conditions? Good pay? Humane treatment?
Retirement benefits? Free lunch?
When we say “legal system”
we also mean the various governments; local, state and federal,
that oversee all retailers and
citizens. It is in this relationship
where ethics and law pretty much
go hand in hand. It is probably
unethical to disobey the law. It is
Each of us bears a
responsibility for not
only following laws, but also an ethical
responsibility to our
fellow citizens, especially
in areas where the law is
not clearly defined.
Every retailer must be aware
of the obligations and implied
promises that are owed to all
government entities. And, there
are quite a few of them, some of
which can be pretty obscure. The
fact of their opacity and obscurity
will not be considered an escape
from governmental punishment,
if violated. “Ignorance of the law
is no excuse;” a statement that I
think I heard in the first grade.
Let’s Test Some Examples
Early in this article, I cited
a couple of examples of likely
We’ll start with the TV promotions
of some of the “Bed
in A Box” companies. I won’t
comment on the quality of their
products. My beef is the way they
treat brick and mortar establishments.
I’ve seen ads that suggest
conventional retailers are unfairly
overcharging for their products.
They are misleading. Any retailer
can beat their prices, and some
are now starting to figure that
These ads violate the implied
promise of honesty to their customers.
They are lying about
much of their competition to gain
Next, let’s talk about the old,
traditional newspaper and TV ads
that loudly proclaim; “Everything
is on sale at HALF OFF!” Nobody
sells at half off, even when going
out of business. When they say
“half off” they mean half off of
the old four times cost equals
the furniture store regular price.
Taking half off of that price gets
it back down to the “tagged
price.” Again, this is a violation
of the implied promise of honesty
to customers. How do they keep
getting away with it? In some
states, the law has recognized
this grievance and has remedied
it by government statute.
Sadly, that is when the government
has to intervene. When
unethical, dishonest behavior
becomes so extreme, they have
to pass a law to control it.
And, there are many more
ethical issues furnishings retailers
face. I've known many that
have strong and conflicting views
about the ethics surrounding the
presentation of different types of
financing and protection plans.
Ethics And Your Business
Earlier in this article we asked
if business ethics are born more
often out of competitive self-interest,
a desire to do what's right, or
a bit of both?
Whatever the motivations,
retailers are wise to consider their
ethical responsibilities to customers,
employees, family members
and their communities.
As well, they must consider the
consequences, in this time of
social media, of having their ethics
challenged in a court of law
or the court of public opinion.
In an imperfect, human world,
ethical grey areas can and will
arise, so it's important for every
furniture and bedding retailer to
think about their behavior in their
businesses, then draw an ethical
line in the sand.
Define the explicit and implied
promises you choose to make to
your customers, employees and
communities. Model this behavior, then hold everyone in your
organization to a high standard.
Fortunately, there are a spectrum
of acceptable and business-
savvy ethical behaviors
furnishings retailers may adopt,
thrive, and still sleep well at night.
By the way, if you sell bedding,
read my book, “The Bed Seller’s
Manual, How to Win the Battle
for Mattress Sales” you’ll have
pretty much all the information
you need to beat the competition
in an ethical manner.
Define the explicit and
implied promises you
choose to make to your
and communities. Model this behavior,
then hold everyone in
your organization to a
Editor's Note: Finally, it seems
appropriate to quote from the
64-page code of ethics booklet
published by of one of the most
notoriously unethical companies
of our time, Enron. These were
excerpted by Michael Miller in
his 2012 article in "Columbus
- "Respect: We treat others as
we would like to be treated
ourselves. Ruthlessness, callousness
and arrogance don't
- "Integrity: We work with customers
and prospects openly,
honestly and sincerely. When
we say we will do something,
we will do it."
- "Communication: We believe
that information is meant to
move and that information
- "Excellence: We are satisfied
with nothing less than the very
best. We will continue to raise
the bar for everyone."
- Compensation: "We believe
in offering our employees fair
compensation through wages
and other benefits."
- Consequences: "We have all
worked hard over the years
to establish our reputation for
integrity and ethical conduct...
We cannot afford to have it