Deck 3: Ethical and Legal Issues in Selling

Question 1

Your company has a contact management software system where you enter in all of the information you can about your customers. The company wants to partner with another firm to comarket products. They want to give your database to the other firm so the other firm can create marketing pieces and e-mail them to your clients. Is this legal Is it ethical Why or why not

Answer 1

Case summary:
Mr. Y is responsible for feeding information into a contract management software in his company wherein he enters all the details related to the firm's customers. When the firm decided to come into partnership with other firm for marketing the products of Mr. Y's firm, it asked Mr. Y to share the details of the customer information with the other firm so that this firm could also create emails and other marketing pieces to the customers.
Solution:
This type of sharing of customer details is legal as well as ethical because the information that Mr. Y's firm stored about its customers was the general practice associated with any of the firm and also that at the time of collecting customer information from the customers, the firm did not mention that this information will be kept confidential and not shared with others. This shows no legal or ethical obligations for the firm against sharing the customer information with the other firm that is going to come into partnership with Mr. Y's firm increasing the business of the firm.

Question 2

Review Dr. Evans' list of requests for salespeople (Exhibit 3.5).

Answer 2

Dr. E's list of requests for salespeople suggests various and dos and don'ts for the salespeople at the time of making a sales call to the physicians and doctors selling them the firm's medicines and other products.
Solution:
a. The principles that underlie all the requests made by Dr. E are that the drug sellers should make use of honesty, integrity, transparency, ethics and fair standards while selling and promoting drugs to the doctors and physicians and avoid use of any fake, untruth or exaggerated statements.
b. Dr. E states that salespeople should not ask him which brand of drugs he prescribes, and should also not ask him to prescribe the drugs that they are selling. This is because he will suggest the particular drug to the patients depending upon their individual case.
Dr. E is undertaking such bothersome practice because he wants to be fair with the patients and does not want to work under any drug firm's obligations. This kind of practice that he undertakes of prescribing the right medicine to the right patient no matter what brand it belongs to is applicable to all the customers and patients. This is because every patient and customer come with different disease and needs and depending upon their situations, the doctor or the marketer has to prescribe or sell the right medicine or the product to them. This way the principle and list of requests made by Dr. E is workable in every situation.

Question 3

For each of the following situations, evaluate the salesperson's action and indicate what you think the appropriate action would be.

Answer 3

Sales people have to work under several legal and ethical obligations and this affects their profession to a large scale. If the sales people will not work with high personal and ethical standards, then this will affect their credibility alongwith the goodwill of the firm.
The following are the reactions and actions that salespeople should undertake in the following situations -
a. In this situation, the salespeople should not try to attempt selling the closed-out models to the customers and should not mention these products to them. If any of the customers seems to be interested in any of the closed-out models, then the salespeople should secretly let them go for other product that is not closed-out and do not let the sale of closed out product take place.
b. In this situation, the salesperson should not have complied with the customer instantly and should have informed him that being new to this firm, he cannot assure for a gift without consulting the manager. The salesperson should have politely taken some time from the customer and get back to him as early as possible related to his request.
c. In this situation, the salesperson should politely refuse to remove the safety feature and deny this request of the customer. The salesperson should properly explain the use and benefit of this safety feature and make the customer understand the importance of it and make him understand that even though the speed of the equipment gets affected with the safety feature to a bit, but still it will keep the equipment and its user safe and prevent any accident that might take place in the absence of the safety equipment.
d. In this situation, the salesperson should simply ignore the phone call from the purchasing agent and should not submit another bid to win the tender. This is because submitting of another tender which is 10 percent less the initial bid just on the request of the purchasing agent will make the salesperson to undertake fraud with other low bidders.
e. In this situation, Mr. Y should not take clients to that restaurant because the benefit that is going to be received by dining at that place is not going to be given to the client but it will directly go to Mr. Y's pocket. Thus, in this case, Mr. Y should go to that restaurant to avail that benefit only when he is not accompanied with anyone from his professional arena so that the benefit received by him relates clearly on his expenses.
f. In this situation, the salesperson should have definitely submitted the customer suggestion to the company instead of starting her own business using that idea from the customer. This kind of behavior from the salesperson's side by not submitting the idea to the firm shows fraudulent purpose.
g. In this situation, Mr. JH should straight inform HF Container about the last decrease in the price that the firm could provide to it in the selling price of the product. If the customer agrees to it, then JH's firm should sell the products to it, and if not, then the firm should let this customer go away. And, towards HF's competitor, JH's firm should take this order and fulfil it so that the business could be grown even from this sale.

Question 4

Apply the checklist in Exhibit 3.4 to this situation. Assume there are ethical issues with David's practice. What are they Why would those issues reflect unethical choices

Question 5

What arguments would David probably use to justify this practice

Question 6

How widespread do you think such behavior is in this business

Question 7

What should she do about the Farbucks situation Should she try to find out if Crago plans to bid on Farbucks contract and if so, what their strategy is

Question 8

What should she do about the Hudson account

Question 9

Describe her relationship with Mitch. Where should she go with this account in the future

Question 10

There are certainly many ethical and legal issues in selling, as this chapter demonstrates. Do you think there are more in selling than other jobs, such as accounting, finance, retail store management, or the like Why or why not

Question 11

For centuries the guideline for business transactions was the Latin term caveat emptor (let the buyer beware). This principle suggests that the seller is not responsible for the buyer's welfare. Is this principle still appropriate in modern business transactions Why or why not

Question 12

You are calling on an account when the cu stomer asks if you are going out of business. "Of course not!" you reply. "Why do you ask " Your competitor, it seems, has been saying that you are within a week of declaring bankruptcy. How do you respond to the customer What other action should you take

Question 13

Some professors believe that ethics cannot be taught. Do you agree Why or why not

Question 14

Your manager says, "If it isn't illegal, it's acceptable!" Would you agree Why or why not

Question 15

Your customer asks you what you think of a competitor's product. You know from experience with other customers that it is very unreliable and breaks down frequently. Further, given this particular customer's needs, you expect that it would be an even bigger problem if the customer chose this product. How do you respond Be specific as to what you would say.