environmental issues + fair trade

Question 1

What is ethics?

• how does a business act ethical?

Answer 1

moral principles that govern the behaviour of an indivual or organisation

through
- products they sell
- suppliers
- customers
- staff
- environmental impact

Question 2

what are environmental issues affecting business?

Answer 2

• recycling
• energy source/usage
• sourcing and usage of raw materials
• transportation
• packaging
• waste disposal

Question 3

how does environmental issues affect cost and demand?

Answer 3

• increase in costs :
  upgrading equipment ( for e.g purchase of electric vehicles)
• equipment’s to reduce emissions
• increase on not acting e.g negative publicity can increase cost .

decrease costs
- cost of saving in terms of reduced consumption of electricity

demand
- increase demand
- target “green” consumers = unique group of customers
- charge premium price
- usp = something to separate us from our competitors and encourage people to shop with use
- enhance brand image increase competition

Question 4

what is fair trade?

how does it impact costs and demand?

Answer 4

social movement whose stated goal is to help producers in developing countries achieve better trading conditions and to promote sustainability.

impact on costs
- increased cost of raw material = business will paying more for a fairly traded good. you will be paying for a cost that will reflect the suppliers cost of production and enable them to have a reasonable living.

• cost of monitoring suppliers = business will be monitoring suppliers ensuring that the goods are fairly traded because if business do not monitor their suppliers it may have negatively publicity as for e.g a journalist may found that a business claims to have fairly trade goods but find out that suppliers are not being paid fairly this can cause backlash on business because of their ignorance.

impact on demand
- positive publicity
- target ethical consumers
- charge premium price