The Importance of Fairness in a Retail Business - Research Proposal Example

Primark faces inquiry over its use of illegal labour Research Proposal Introduction to the problem: Living ethically has become socially and morally more acceptable in the world today. A few decades ago, people only cared about their own well being and did not look into the methods and ways through products were being manufactured. As the awareness is increasing, there is a new trend emerging as shown by the consumer behaviour studies and researches. Ethics in business has taken prime importance for the consumer of the 21st century. More and more customers are inclined towards using the product that is being produced ethically, maintaining quality standards, meeting labour standards and fulfilling all the responsibilities of a citizen of the business environment. This increased awareness of the consumer in terms of ethics and its impact on buyer behaviour is a relatively new phenomenon and is gaining momentum with each passing year. This research proposal discusses the impact of ethical conduct by a business on its consumer’s buying behaviour and if there is any impact on the brand acceptance of a product caused by negative publicity related to ethics. Primark has been chosen as the organization for which this research will be conducted. This organization is perfect for this research as there have been controversial issues related to their business practices in the past. The literature review provides a complete background of the issue, followed by the research design of the proposed research. Ethical and practical considerations are named after, followed by the timetable of activities and a brief of data collection instruments that will be used for this research. Literature Review: The organization chosen for this research proposal, owing to the recent controversy that they are in, is Primark. Primark is a 200 plus store clothing retailer working in the European region; this includes Netherlands, Germany, Spain, Portugal, Belgium, the United Kingdom and Ireland (where it is branded by the name of Penneys). There are mammoth stores present across Europe providing consumers with cheap clothing retail products. Their tag line “Look Good, Pay Less” is reflective of their strategy and their target market. They are segmented to target the young population passionate about looking their best, for the prices that they can afford. They are known to be selective in providing only the most popular sizes of their target market, buying and selling in bulk in order to save for themselves and for their consumers (Company Website, 2011). Throughout the past decade, Primark has been the subject of intense investigative actions by freelancers as well as government authorities for their suppliers and if their products meet ethical standards set by the Ethical Trading Initiative. In fact, Primark joined the ETI after they had been calculated at 3.5 out of 20 in an ethical index by Ethical Consumer (Press Release, 2006). ETI is an initiative that works on labour rights issues in supply chain; members have to make sure that they only employ suppliers that follow the code of conduct based on International Labour Standards and ITE’s core conventions. However, reports in 2008 and 2009 further exposed that their suppliers were not following the code of conduct and the company faced tremendous criticism from major stakeholders in their business environment. Empirical research has continuously shown that organizations that are ethical in their conduct and business processes are rated as favourites among the masses. The general population is highly appreciative of organizations that boast about their ethical standards and provide quality service to such an extent that they are willing to pay extra value for the product. In today’s generation, working unethically can be disastrous for an organization. Still, organizations are involving themselves in cost cutting, low standard methods that make sure they are able to provide product at a lower price. Price still dominates as the primary factor for many people; for the same quality they will buy the cheaper product if it means a smaller decrease in ethical standards. This exists in societies that are demographically present in the lower income scale. A retail business that is working with all fairness will also have equitable relations with all the stakeholders in its environment; this includes suppliers, customers, employees etc. Without the stakeholders, a business cannot exist. Therefore, sound relationships will all stakeholders ensure that the business stays fruitful (Mark, 2010). Ethics is subjective as well; organizations will have to make sure that they are ethical in all their ways as it is instrumental in ensuring that organizations are successful and ultimately live up to the corporate social responsibility of the world in which they are operating. Research has showed that organizations who are ethical in their conduct, gain more profits than their counterparts. Ethical organizations will disclose all processes of their product development, without any shame and will make sure their customers know exactly what they are using. It creates brand loyalty which is the ultimate goal of all long term marketing strategies. The most important aspect of a business is intangible; the goodwill it generates in the society. Ethical businesses generate goodwill that has no alternative in the business environment. If an organization loses its goodwill, they are bound to loose in the long run (Aastha, 2010). Research Design: The research strategy that will be followed for this organization will be exploratory as well as explanatory. It will be mix where two things will be accessed; whether ethical behaviour of an organization will affect its consumer’s buying sense, and the extent to which it affects if there is any affect. The research will be conducted through extensive surveys from its customers as they are the prime stakeholders in terms of this research. Stratified random sampling will be used where the target market of Primark will be asked about changes in their buyer behaviour, whether or not they shop from the brand. This will provide us with a bird’s eye view of the consumer populations’ inclination and buyer behaviour (George, 1998). The data will be collected through surveys. Surveys are questionnaires that are given to the target market of the research; these contain open ended or closed ended questions. A variety of surveys will be used; online surveys will be posted at the Primark website as well as made viral through Facebook marketing. Also, face-to-face surveys containing the same questionnaire will be conducted through agencies working in the malls for research. Both these methods are relatively cheaper and provide maximum benefits towards a research of this kind (Mark, 2009). The questionnaire will contain open-ended and closed-ended questionnaire to provide insight from the customer on the impact they feel ethics has on their buyer behaviour. The closed ended questions will then be analyzed against hypotheses that will be constructed. Data analyzed through software such as SPSS will then be evaluated against the hypotheses and presented in the form of a report. Practical and Ethical Issues: Practically, conducting an extensive research is time consuming and data analysis is highly important. The extractions made from the data are the most important part of the research and therefore tremendous care should be taken while analysis. Ethically, it is important to maintain neutrality from the part of the researchers who are conducting the face-to-face interviews. Interviewer bias can come in surveys that have open ended questions. Plan and timetable of activities: The initial construction of the questionnaire will take about two weeks. Administration of the questionnaire will approximately take 3 to 4 weeks. The data analysis and conclusion of the research will take about another 2 weeks. Overall this research should be complete and ready to be presented in about two months. Data Collection Instruments: Questionnaire: Some of the questions that will be included will look like this: 1. How important is Ethics for you in general life? 2. How important is ethics in business for you? 3. Would you rate an organization who is ethical in nature more than the one with a negative publicity about ethics? 4. Would you buy from an organization known for their ethical products and services even if they charge 5% higher to commit to ethical behaviour? 5. If you won’t buy at a 5% higher price, what is the percentage you are willing to pay for which is higher than a competitor brand with known ethical issues in their supply chain. 6. How has the perception of Primark changed since their issues with ethics in supply chain in 2005? 7. Do you still buy from Primark? 8. Will you buy from a competitor over Primark even if they charge a higher price for a similar product, on the basis of ethics in supply chain of their products? 9. How would you rate an ethical organization on the basis of likeness on a scale of 1 to 10 with 1 being the least liked and 10 being the highly liked. 10. Is being ethically conscious important in today’s world? Appendix: Bibliography Marcoulides, G. (1998). Modern methods of business research. Lawrence Erlbaum. Saunders, M., Lewis, P., Thornhill, A. (2009). Research Methods for Business Students. Pearson Education. Schiffman, L., Kanuk, L. (1997). Consumer Behavior. Prentice Hall. Fletcher, M. (2010) The Importance of Fairness in a retail business. Available from http://ezinearticles.com/?The-Importance-of-Fairness-in-a-Retail-Business&id=5196763 [20th March, 2011] Dogra, A. (2010) Importance of Business Ethics. Available from http://www.buzzle.com/articles/importance-of-business-ethics.html [20th March, 2011] Primark/ company website. (2011) History. Available from http://www.primark.co.uk/ [19th March, 2011] Read More