Company Q Inventory Control

A, has recently made business decisions that appear to be attempts to protect the company by minimizing losses. Closing two stores in high crime areas, and declining to donate day old products to local food banks due to the possibility of fraud and concerns of employee theft may initially help Company Q’s bottom line, the passive attitude toward social responsibility will have a much greater negative impact on the company in the long run.
In closing the two stores in high crime areas, Company Q initially may have eliminated losses in those two stores due to theft, vandalism and other crimes. And although this initially appears to have a positive impact as far as protecting the company and its investors, it also completely removes any chance

of profitability those two stores might have had. In addition, closing the stores causes a negative impact on the community due to loss of jobs and elimination of the goods and services the stores were offering to those communities. As high crime areas, those communities would stand to benefit the most by having socially responsible businesses located there.
Based on the facts provided, it is unknown what Company Q’s attitude is towards its legal social responsibility. No evidence has been provided to determine if Company Q is in fact complying with and obeying all laws and regulations, therefore it is impossible to offer an opinion on that aspect. It is stated that they do have a great concern about their employee’s potential to commit fraud and/or theft. Employee theft and fraud would contribute to higher prices in the marketplace which also impacts the community and it is important for Company Q to address these concerns as well as implementing measures to deter these actions.
Company Q has both ethical and legal concerns regarding the potential for fraud and theft by its employees, so much so that they declined to donate their day old items to local food banks citing those reasons in particular. This seriously hampers what could be a prime opportunity to build their philanthropic social responsibilities and calls into question the larger picture ethical responsibility towards its primary stakeholders, in particular its employees, shareholders, suppliers and the community, which would greatly benefit by Company Q making their ethics concerns part of their business foundation.
Company Q does show a small measure of philanthropic responsibility by starting to carry, as consumer request over many years, a small selection of health conscious and organic products. However, due to the high margin nature of these items, it may impact their ability to turn a profit on these items which could impact inventory expansion in this area or the elimination of these products all together which would negate the initial positive impact.

Evaluation of Company Q and Recommendations Part B.
Company Q can make several changes to turn around its current attitude toward social responsibility, which will in turn create a better bottom line financially, create a better working environment for its employees, foster and improve relationships with its suppliers and the community, and have a positive impact philanthropically on the communities they serve.
1. Develop an ethics program that applies to employees at all staffing levels that develops an atmosphere of trust and honesty. This program should address all areas of current concern such as fraud and theft, but also include clear and concise expectations on employee attendance, performance, ethics, dress code, customer service, and all other areas that could impact the operation of the business and its duties to its stakeholders both primary and secondary. The program should provide regular reviews and updates on training and also provide an avenue for employees and other stakeholders to report concerns and violations without concern for retaliation. The policy should include background checks and drug screening for all levels of staff. Regular reviews should be conducted for each employee and any questionable behavior should be addressed and documented, Ethics violations should be dealt with immediately and fairly. Teamwork, camaraderie, pride in the job and workplace, and social responsibility should be encouraged and rewarded.
2.

Develop tighter standards for inventory control. Work with suppliers to account for incoming inventory and compare stock levels to sales to determine losses. Identify ways implement loss control measures such as security, both physical and electronic surveillance, employee engagement with customers, and through ethics training with employees to prevent internal losses. Utilize inventory control measures further to develop a charitable donations program to allow donations of day old products to local food banks and other organizations such as schools, churches and for community fundraising events. For example, inventory day old products creating a list of items to be donated. Have inventory signed off by at least two members of staff, one of which should be a supervisor or store manager. Have a representative of the receiver of the donation review the list for accuracy and also sign off on the inventory list. Donation lists can then be used for regular inventory tracking and also as tool for proving tax deductible charitable donations for the company. This will foster higher ethical behavior for the company’s staff, lower losses due to consumer theft, and begin to create an environment of community involvement and charitable

giving.
3. Develop new and stronger relationships with suppliers of health conscious and organic products, local suppliers if possible, and expand the availability of these products in store. By developing these relationships, products can be obtained at a much lower price which would reduce the margin for markup to the consumer, making the products more affordable. Local farmers markets and small upstart companies are a good starting point. This not only will allow for the expanded ability to provide these products to the consumer at affordable prices, but also helps to support local growers and upstart businesses in the community. Consider including products from these categories in the charitable donations program.
By beginning with these recommendations, Company Q can be well on its way to having a better reputation of community involvement, employee engagement, customer service and a much better relationship with and attitude toward the communities they serve. In turn this will increase profits and create the ability to grow the business.