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Business ethics case study and analysis
Business ethics case study and analysis
Business ethics case study and analysis
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After reading the article, “Why 62,000 Abercrombie & Fitch Employees Are Suing The Company,” there were two different problems that were brought to attention regarding Abercrombie & Fitch’s business ethics. The two problems were the mistreatment of their employees, and how their business marketing strategy is not well developed throughout their company. Abercrombie & Fitch is a company that has always been concerned about their image, which leads us to their, “look policy.” A “look policy” is a policy that relates to a certain look every employee has to follow to be eligible to work there. The company is facing a high-profile lawsuit over its, “look policy” (Greenhouse, 2015). Each employee is forced to purchase the company’s clothes to wear to work, each time a new sales guide comes out (Greenhouse, 2015). This is known as compelled purchases, which is a violation of the state’s labor codes (Greenhouse, 2015). They force the “look policy,” way too strong upon their employees, which developed into a huge problem. The company is facing a high-profile lawsuit …show more content…
over its, “look policy” (Greenhouse, 2015). Reed Marcy, an attorney representing to plaintiffs, spoke a few words regarding this situation. This is resulting in harm for employees, “being sent home or losing shifts for showing up "out of uniform" or failing to meet the copious requirements about hair color, fingernail length, makeup style and other requirements of the controversial "look policy," which Marcy described as discriminatory and illegal” (Greenhouse, 2015). With their ability of focusing on their image so much is resulting in effect on other parts of the business, which is poor marketing.
It is affecting their revenue and product quality. With the economy lowering throughout the past couple years, it has been a major reason that the earnings at Abercrombie & Fitch and their product quality has decreased so much, but that is not the only reason. As stated before, the company is more focused on their image. Their image has always been there main focus, which being able to obtain a good image within a company they need to have good quality products, which will also result in an increase of revenue. Therefore, Abercrombie & Fitch does not understand that. They believe that a image such as making sure their employees look the best, to the point of forcing them to wear exactly what they want will cover the overall image category in the marketing aspect of the
company.
Abercrombie and Fitch is an American retailer who has been facing many outstanding issues and is at risk of disappearing. For the past two decades, the company has been facing severe controversy. Abercrombie and Fitch has been long criticized for lack diversity and inclusion. The company excludes minorities and plus-sized customers from its stores. This controversy has brought many financial problems to Abercrombie and Fitch.
J. Crew, also known as J. Crew Group Inc., is a private label company known for its preppy fashions that are fashionable yet costly. Essentially, the company was owned by the Cinader family for most of its history. Mitchell Cinader and Saul Charles founded the company in 1947. It was originally known as Popular Merchandise Inc. doing business as the Popular Club Plan, in which Mitchell’s son Arthur was the overseer. The company sold women’s clothing through in-home demonstrations. In the early 1980’s, Cinader and Charles observed catalog retailers such as Land’s End, Talbots and L.L. Bean reporting rising sales in revenue. With intentions to increase sales and duplicate success of these well known companies, Popular Club Plan began its own catalog (http://www.fundinguniverse.com/company-histories/j-crew-group-inc-history/).
Facts of the Case: In 2008, Samantha Elauf applied for a job at Abercrombie & Fitch, Inc., who as part of their “Look Policy” prohibit the use of caps. Elauf, as part of her religious practice, wore a headscarf to the interview. She was interviewed by assistant manager Heather Cooke, who gave her a score that qualified her to be hired. Cooke, however, was worried that Elauf’s headscarf was against the store’s policy and called her district manager Randall Johnson. She informed Johnson of her belief that Elauf wore her headscarf because of her religion, and Johnson replied that headwear whether it was religious or not violated the “Look Policy” of the store. Elauf with the help of the EEOC sued Abercrombie on the grounds of religious discrimination. The U.S Equal Employment Opportunity Commission (EEOC) is an agency established by the government of the United States that imposes federal laws that make it
In December 2003, Abercrombie and Fitch decided to stop issuing its quarterly magazine, which it had published in addition to its catalogs since 1997. In a statement issued at the time of the recall, Abercrombie said, "While it has enjoyed success with the Quarterly over the years, the company believes it is time for new thinking and looks forward to unveiling an innovative and exciting campaign in the spring." "We just felt it was time to retire it and come back with something that has beautiful imagery and classical photos," said Hampton Carney, company spokesman, in the Times. "... But that doesn't mean they're going to go totally conservative and lose their nerve. According to CNN.com, Abercrombie said that the recall of the magazine was due to the need for counter space for a perfume, but opponents of the catalog are saying that it was in response to protests against its racy content, such as nude models and articles about sex. Criticism is not new to Abercrombie's marketing strategies; groups such as the National Coalition for the Protection of Children and Families, the American Decency Association, and the Focus on the Family organization have protested against its sexual content for several years, according to the New York Times.
For the purposes of this paper we will be discussing the boycott effects on Abercrombie & Fitch; a U.S based clothing company. At first we will analyse the concept of boycotting international companies to understand the different choices boycotters make when targeting the guilty company. We will look at the history of the company; it’s beginnings, evolution of concept, failures and successes. An important part of this paper will be assessing the main factors and reasons that led to the boycott. We are going to be analysing the effects of the boycott keeping in mind that although the reasons behind the controversial boycott have taken place a couple of years ago, only in 2013 has the boycott been initiated by several different parties involved. To be able to understand what triggered the boycott to begin we are going to try to understand how it all came about to begin with. There are several concerned parties in the boycott and each have their own agenda and reasoning to boycott the company. To give a more thorough analysis of the initiators of this particular boycott their relation to one another will be discussed in the paper. Another important part of the boycott is the different types of effects that these boycotters have on the company. We will closely study the reasons, the effects, the affected parties, and the path for damage control and reconciliation chosen by Abercrombie & Fitch as well as its results both the negative and the positive. Finally we will discuss the effectiveness of the boycott on the Abercrombie’s internationalization, market strategy, competitiveness, and market activities.
Primark is a subsidiary company of the Associated British Foods (ABF). It was first opened in Dublin in June 1969, which under the name Penneys. Four more stores were launched within a year in Ireland afterward. Currently, Primark operates in over 270 stores in 9 different countries in Europe such as United Kingdom, Germany, Spain, etc. Primark capitalised on the fast-fashion tendency that began in the 1990s as well as the capability to produce garments cheaply in Asia where clothing values fell dramatically (Shawcross, 2014). It offers a diverse range of products which includes kids clothing, menswear, womenswear, accessories, home ware, beauty products and confectionary. According to TNS market research ranking, Primark ranks the second
The return on equity for the company stood at 18.71% in 2009 as compared to 20.90% for the year 2008 which shows a declining trend. The investors are always keen to see high returns on their investments, but here the return on their equity is declining. It is a negative number for the company and if the trend continues the investors will lose the confidence in the company and will cease to invest in the company.
For the sake of completeness, it is possible to cluster products rather than consumers by using product segmentation .According to (Bamett, 1969), consumer segmentation should be abandoned and much emphasis should be laid on field specific criteria by which consumers distinguish between products and brands. Nonetheless, according to Lunn (1978, pp. 366-367), it is valuable to cluster consumers in terms of their requirements from product field specific variables as it is to cluster products in terms of the extent to which they are perceived to satisfy these requirements. Thus it is very important for Abercrombie and Fitch to do product segmentation as it is very useful in identifying which products or products are competing with each other.
Martha Stewart and Macy’s signed a contract saying that Macy’s could sell Martha Stewart branded products in Macy’s stores, including exclusive items like kitchenware and bedding. Over the years, Macy’s has made a massive profit from this line. Without consent, Stewart and JcPenneys made a deal saying that JcPenneys could sell home décor products out of Martha Stewart store-within-a-store locations at Penney’s stores. Macy’s sued them both for a breach of contract, and violating the terms of its original contract with Martha Stewart Living. Macy’s wanted JcPenneys to take certain items off of their shelves and demanded compensation for loss of profits. JcPenneys and Martha Stewart responded that the agreement they encountered with one
Abercrombie & Fitch stated they would revise their look policy when in reality they did nothing to change the environment their employees work in. The store needs to refile and reexamine their policies and stipulations. If the company cannot accommodate a growing acceptance of religion in America, then perhaps they should not be in business. I have a growing dislike for the company as I examine their previous lawsuits and cases of discrimination and
American Apparel is a story of rags to riches and back to rags. It rapidly grew into one of the most well known and most controversial clothing companies in the world. The company began with a simple goal, making a profit selling local and ethically-manufactured blank t-shirts, sweatshirts, and jeans that were moderately priced. American Apparel managed to disturb the entire fashion industry with it’s unique identity, constantly pushing the envelope with its controversial methods of branding. The logo-free garments became an iconic uniform for young liberal adults. How could this company quickly become a symbol of what is cool and edgy and equally as fast file for bankruptcy?
The apparel retail industry is now experiencing a huge development and making a remarkable contribution to GDP, it needs a better and exclusive regulatory framework to sustain the impressive overall growth of the industry. Competition in the retail apparel sector is getting stiffer in the nation as many big market players both national and international are testing and applying different retail plans in the market .Entry by new players is still at a promising stage. But, the increasing competition in the sector would, in due course, lead to a drop of profits with each retail chain trying to attract consumers through new, innovative and effective ways.
This new hip clothing store has labeled itself a sweatshop free. It employs over five thousand people at the Los Angeles location (Li par 27). This is incredible. It has given the people of Los Angeles many opportunities to improve their lives and to keep a steady job. The employees here are able to pump out around 200,000 garments of clothing per day (Li par 27). This is a great amount of production. This is in part due to how well the employees are treated. Shan Li describes their benefits as, “American Apparel's factory workers earn an average of $12 an hour. They have access to $3 subsidized lunches, an on-site medical clinic and free massages” (par 29). Being treated with respect often makes employees work harder because of the good relationships they have with their bosses. This is clearly shown by how much clothing is produced daily. American Apparel is a business that other American clothing companies can look to for guidance. With their annual sales of 634 million dollars, this store has shown what is possible for production in the United states (Li par
The Albany-based fashion retailer Abercrombie & Fitch (A&F), once renowned for selling sexy tight shirts to teen, has reported sales of $685.5 million for the quarter, down by $20 million compared to a year ago. The once popular apparel retailer is now in serious trouble as sales have plunged, along with their stock at a sixth year low. Some believed the blame for Abercrombie’s flat sales was related to their former CEO Mike Jefferies who stepped down December 2014. The highly discriminatory CEO was criticized for his comments about wanting “cool, good-looking people” to wear his company’s clothes. Today as the company’s clothing has fallen out of fashion, only 13% of people still shop at Abercrombie, with the other 36% stating rarely and 54% replied to never shop there.
Shopping at Abercrombie or watching La La Land at CGV with the “popular group” is a fantasy everybody once dream about in their lifetime. In Seoul International School, my friend Sophia is intelligent and particularly exceeds expectations during social studies class. On the off chance that you toss her a question about The Ottoman Empire, without uncertainty, she would give you the appropriate response quickly. She is agile and flexible, therefore, the physical education teachers at my school laud at her abilities. Her wavy, brunette, hair is complimented by her astounding fashion choice and she looks dazzling from the top to bottom.