In the early 1900’s the economy was changing, and the automobile industry was booming. Sears, Roebuck began as a small mail order company, and later transformed into a nationwide chain of retail department and specialty stores, which included appliances and auto service centers (Emmit, Jueck and Rosenwald, 1951). In the late 1980’s Sears began to see a drop in revenue due to similar market retailers setting up shop nationwide. This created a number of hardships for Sears. On June 11, 1992 The California Department of Consumer Affairs charged seventy-two of Sears, Roebuck’s auto repair centers with defrauding customers by performing unnecessary service and repairs (Fisher, 1992). The Department’s Automotive Repair division charged Sears repair centers with fraud, false advertising, failure to clearly state parts and labor on invoices along with making false and misleading statements a (Fisher, 1992). This case is unique because, it was the first time The Consumer Department of Affairs had targeted the statewide operations of a company (Gellene, 1992). This paper will discuss the events that led up to over forty states seeking the revocation of licenses held by Sears auto centers, along with the types of fraud committed.
In February of 1990 The California Department of Consumer Affairs conducted an 18-month undercover investigation into auto repairs performed at thirty-eight Sears’ automotive centers. This was due to a nationwide increase in consumer complaints in regards to repairs performed at Sears automotive repair centers. Complaints began to pour in, after Sears switched employee wages from hourly to commission. Cars that were in gently used condition, were taken to Sears for mechanical inspections, and were overcharged an av...
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...ers to ensure that its automotive repair centers were not engaging in fraudulent practices. The company also agreed to be more descriptive when recommending repairs to its customers. Shortly after the settlement Sears eliminated over 10,000 full-time and part-time service center positions. The company closed many of its automotive repair centers, claiming that it would focus on selling tires, batteries, and brakes. Sears stopped offering tune-ups, engine diagnostics, radiator services and other repairs (Mateja, 1993). Despite the efforts of Sears, the auto repair industry still has a reputation for bilking customers into paying for unnecessary repairs and services. As a consumer it is difficult to know, if you are being treated fairly, unfortunately there are not enough measures and laws put in place to ensure consumers are protected from shady business practices.
According to the court case on Pam Huber v. Wal-Mart Stores, Inc., I am in agreement with the fact that the “district court granted summary judgment in favor of Huber” (Morgan, p.413) and that Wal-Mart gave Pam Huber, a maintenance associated job due to her disability. In doing so, I am also in agreement with the fact that Wal-Mart did not breach the American with Disability Act of 1990 due to the fact that Wal-Mart specifically stated what was required of Pam Huber to do on the job. Due to that, I am in agreement with Wal-Mart’s decision to hire a capable candidate in replace of Pam Huber due to their policy.
There will come a time when the car a person owns will need some necessary maintenance, or something breaks and has to be replaced. Labor rates for auto repairs have skyrocketed, with rates averaging from $100-$138 an hour. (Roth, 2011) If a repair is complex enough, that hourly rate may not be a factor, but with some repairs, a person may find that the labor costs are a lot more expensive than the part that is being replaced. I...
Takem’s is an appliance store in the state of Virginia serving the residents of the Appalachian regions of Virginia, Kentucky, Tennessee, and West Virginia. The business model which is currently being conducted in the appliance store has been called into question by one of the customers who has recently purchased a computer on credit. The owner of the store, Tommy, is now contemplating what should be done to handle this situation and protect his interest in the future. In this discourse, the author attempts to reveal to the reader the alleged infractions that Takem’s may be liable for regarding the situation with his customer, Ms. Sally
"Is the Auto Industry's Recovery a 'Success Story?'." Internet Wire 24 Nov. 2010. General OneFile. Web. 25 Nov. 2011.
There is an evil company in Arkansas, some say. It's a discount store-a very, very big discount store-and it will do just about anything to get bigger. You've seen the headlines. Illegal immigrants mopping its floors. Workers locked inside overnight. A big gender discrimination suit. Wages low enough to make other companies' workers go on strike. And we know what it does to weaker su...
The Massachusetts Supreme Court’s jury found that Toys R Us was liable for wrongful death, negligence, and breach of warranty and awarded t...
Nearly four decades past its peak, Sears strives to maintain steady profits against its competitors (Howard 2017; Meyer 2017).
As a result, GM’s developer Edward Cole was well aware of the major design defect of the excessive weight in the rear causing General Motors to face 106 Corvair liability lawsuits involving injuries and death. After the publication of Nader’s book General Motors hired a private detective in New York to gather information and discredit Nader. Nader sued General Motors for invasion of privacy winning millions in the lawsuit. Furthermore, CEO James Roche promoted Edward Cole the Corvair design engineer in question, to GM’s President. Did the CEO Roche of General Motors make a sound ethical decision with the promotion?
The movie “Glengarry Glen Ross” presented a series of ethical dilemmas that surround a group of salesmen working for a real estate company. The value of business ethics was clearly undermined and ignored in the movie as the salesmen find alternatives to keep their jobs. The movie is very effective in illustrating how unethical business practices can easily exist in the business world. Most of the time, unethical business practices remain strong in the business world because of the culture that exists within companies. In this film, the sudden demands from management forced employees to become irrational and commit unethical business practices. In fear of losing their jobs, employees were pressured to increase sales despite possible ethical ramifications. From the film, it is right to conclude that a business transaction should only be executed after all legal and ethical ramifications have been considered; and also if it will be determined legal and ethical to society.
The company that we are auditing is a regional convenient store chain called Wawa. Many local people think that the store is a cash cow that cannot do anything to hurt its profits or market share. The truth is, the company is large and successful but it is not invincible and for many reasons. The company is privately traded, meaning it cannot issue common stock to help itself get out of hard times financially. Wawa is local with stores in New Jersey, Delaware, Pennsylvania, and Virginia. Although Wawa has a good reputation with local people, out of town people are not as aware. Fortunately, Wawa distributes products that are inelastic in nature. Gasoline, food, and tobacco products for most people, no matter what the condition of the economy is or how much money they cost, they will still buy them.
Sears does have a fairly good reputation despite the bad press that they may have received because of problems they have had with the federal government. If they can keep out of trouble and try to keep their reputation clean, they should be able to leave these problems behind them. People will forget unless they run into similar problems again.
In July 1996, Alert J.Dunlap (also known as Chainsaw Al)was hired as CEO and Chairman by Sunbeams' board of directors to help the company from a period of lagging sales and profits and make it an attractive acquisition target.
On February 27, 1992 Stella Liebeck of New Mexico went to purchase coffee from Mc. Donald in her grandson’s car. Liebeck’s grandson then parked the car to give her an opportunity to put her cream into her coffee. The car transporting her at the time, had no cup holder so she improvised and placed the cup between her legs. During that process Liebeck spilled all of her coffee and was rushed to the hospital, because the coffee burn through the pants that she was wearing. Upon arriving at the hospital she was informed by the doctors that she suffered third degree on six percent of her skin. Liebeck suffered tremendously as a result of the burn. She was hospitalized for eight days and had to undergo surgery. Apart from that she was somewhat disabled for two years. Liebeck made attempts to settle with McDonald, she wanted them to be accountable for the injury she suffered. She wanted them to pay for the incurred expenses as well as the expense she anticipated in the future. McDonald on the other hand agreed to pay $800.00 but Liebeck was asking for $20.000. This case wasn’t settled using ADR methods so it became a trial (Wiki, n.d).
Noel, Dix. “Defective Products: Abnormal Use, Contributory Negligence and Assumption of Risk” Vanderbilt Law Review. New York: Bedford/St. Martin’s, 2002. 313-23. Print.
Consumers are concerned not only about a product breaking down but also about the time before service is restored, the timeliness with which service appointments are kept, the nature of dealings with service personnel, and the frequency with which service calls or repairs fail to correct outstanding problems. In those cases where problems are not immediately resolved and complaints are filed, a company’s complaint-handling procedures are also likely to affect customers’ ultimate evaluation of product and service quality.