I was watching a local news segment the other day about the announced closing of the Macy’s store at a shopping center here in Indianapolis. The reporter was interviewing a woman, who had not realized the store was closed and had obviously attempted to shop there that day. When asked about her feelings seeing the store closed, she replied (and I paraphrase), “Well it’s really sad, another store abandoning the area all because they can’t make enough money.”
Does Macy’s have a moral or social obligation to keep a store open that does not meet their profit guidelines? They are in business after all to make a profit, aren’t they? And, if Macy’s does have that obligation, then don’t we have the obligation to shop there? I wish the reporter had asked the woman where else she was shopping that day. Wal-mart? Or perhaps some other discount retailer? Or maybe they should have asked how many times she comparison shopped and bought the same item from another retailer because they had it for a few dollars less than Macy’s.
It raises some interesting questions and it creates a vicious cycle.
As consumers we are always shopping for the lowest price, many times willing to give up brand loyalty, store loyalty and even quality to get it. This drives the small retailer from business, the larger retailers are constantly cutting costs to keep margins, and manufacturers also are forced to cut costs to make a profit. This can lead to lower wages for employees, jobs sent out of the country, reductions in quality, and ultimately to the elimination of the brand altogether. This, in turn, leads to workers making less money or losing their jobs, therefore needing to shop for the lowest price. We have met the enemy, and they are us!
On the other hand, businesses that continually raise prices as a way of increasing profit margins, or continually cut their costs to the detriment of their employees or their supply chains or the planet to increase their profit margins also contribute in large part to the cycle. (Yes, I believe businesses should make a profit!)
It raises some interesting questions, does it not?