CHAPTER 1 EXERCISE 3

Exercise 3: Ethics in Business Consumers and lawyers in more than 10 regions accused a prominent nationwide chain of auto repair shops of misleading customers and selling them unnecessary parts and services, from brake jobs to front-end alignments. "In the face of declining revenues, shrinking market share, and an increasingly competitive market management attempted to spur performance of its auto centers The automotive service advisers were given product-specific sales quotas - sell so many springs, shock absorbers, alignments, or brake jobs per shift - and paid a commission based on sales [F]ailure to meet quotas could lead to a transfer or a reduction in work hours. Some employees spoke of the pressure, pressure, pressure" to bring in sales. This pressure-cooker atmosphere created conditions under which employees felt that the only way to satisfy top management was by selling products and services to customers that they didn't really need. Suppose all automotive repair businesses routinely followed the practice of attempting to sell customers unnecessary parts and services. Required: 1. How would this behaviour affect customers? How might customers attempt to protect themselves against this behaviour? 2. How would this behaviour probably affect profits and employment in the automotive service industry