If Primark are found to be operating unethically then their reputation will fall which will stop existing customers from buying form them and discourage new customers. This will lower their sales revenue.
They may also be fined for breaching employment legislation in that country which will increases their costs and lower their profit.
Suppliers may also not want to trade with Primark as they may be impacted by their bad reputation to. This will mean they may not get the raw materials to make their clothes.
The biggest consequence of not trading ethically for Primark is their loss of reputation as this will have the biggest impact on their profitability. Primark will need to invest in training and systems to ensure they are working in an ethical manner. They will also need to communicate the good work they are doing to customers. This will cost Primark time and money but will ensure that consumers are satisfied that they are buying from a responsible retailer and that they are protected from negative publicity
Changing Business Practices 10 Mark Question
Britain is facing an ageing population. Apple will need to change their business practices to respond to this or it may result in negative consequences for the business.
Apple can change their business practices in a number of ways to respond to an ageing population. One thing that they could do is adapt their products to be more suited for the older generation. This could include things like bigger buttons or special ear phones. By adapting their products for the older generation they will be able to meet the needs of a growing sector of the market. Apple could also adapt their advertising to appeal to the older generation. This again will attract the older generation to buy Apple’s products, helping to increase Apple’s profits.
If Apple do not change their business practices then a competitor might appeal to the older generation instead. This will result in a loss of potential customers for Apple which will lead to a loss in potential profit. It might also make the competitor stronger which will make it harder for Apple to compete. Another negative consequence to Apple of not making changes to its business practices is that they might make their existing customers unhappy. This is because many of these existing customers might be part of the ageing population and would feel under- valued by Apple if their needs were not being met. These customers might stop buying Apple products resulting in a loss of profit.
Apple need to be aware of changes to the environment like an ageing population and be ready to change their business practices to respond. If they do not then it could mean a loss of customers and therefore profit plus it could allow competitors to become more powerful.