The sales of goods act
Before deciding on a market strategy, many businesses would have to consider the laws which they have to follow these laws are: The sales of goods act 1979, trade description act 1968, consumer credit act 1974, data protection act and health and safety at work act. Businesses have to have each of these laws in order for them to proceed. Sale of Goods Act 1979- this is basically when the buyer and seller interacts with each other to buy and sell a product.
The goods which the seller is selling must be reasonably fit for the purpose for which they were intended, the goods must be of a satisfactory quality and the goods bought must be of an equal standard to those displayed or shown by sample. This act is important to any business because for e.g. EBay the sellers that are selling the goods must be able to ensure that their goods have enough quality for them to sell to the buyers. As a result the buyer and the seller have interacted with other in order to buy or sell the goods. Also the goods being sold are the main aspect which businesses make their revenue.
Trade Description Act 1968- this act is about adverts which are misleading customers. The main things which consumers can be misleaded by are: adverts, packaging and promotional materials such as ‘sale signs’. This act states that products should fit any claim made for a product in an advert. Many businesses should take this act into account because it states that their adverts shouldn’t mean any different from their product.
Consumer Protection Act 1987- this act clearly states that businesses should make their products in order for their customers not to put themselves at risk. For e.g. if a customer at Mc Donald’s are injured because of the floor being slippery without any sign being put up, the customer can then take legal action and claim for compensation. Data Protection Act 1998- this act states that information which are confidential and personal should be stored in a database were only customers can only access their file by passwords and a form of identification. For e.g. a customer who’s with Halifax account details are stored in a database so no-one can access their file. From this act businesses should ensure all their customers personal identification are stored in the database so it couldn’t be misleaded.
A situation where the laws and guidelines have been broken is in the Nike case study where many of their employees weren’t treated properly by the labour abuses, unsanitary conditions and also they were forced to do overtime. This situation doesn’t meet the Health and Safety act because it states that employers should take responsibility for the Health and Safety of their employees at work which Nike didn’t do. As a result the consequence that followed was that many activists made the world know how bad Nike treated their employees. Also they were using young children under the age of 16 to do labour work for them which they have broken the law stated in the children’s act. This states that children under the age of 16 aren’t to be employed under any circumstances.
Also a situation where the laws and guidelines have been broken is where a mouse was found in a tin of beans, so the customer that opened it was put in danger because they could have eaten the tin of beans were the mouse was in. This clearly covers the Consumer Protection Act because this act states the protection businesses should have over their products and at this point the makers of the beans didn’t follow the laws and guidelines.
Ethics is based on other people’s personal opinion on what they think about a particular topic. For e.g. other people might think that swearing is a bad thing but other people might think that’s it’s alright to swear because it might have a different meaning in another culture. Ethics is also a morality and its doing ‘what is right and not ‘what is wrong’.
Ethics can affect businesses in a good or bad way. Ethics can affect businesses because of the views and opinions of people in order to make business into a good one. The views and opinions are the responsibility of the shareholders of any business because they take on board the ethics in order to make their business successful. It can also cause a lot of problems for businesses because the views and opinions of the people running the business can effect it because they might not all agree with one another and they might disagree with the views in what their fellow employee is putting across.
A business that have been affected by ethical issues is Nike the reason is because of what the activist thought of the bad things Nike was doing. Ethics has affected Nike in many ways because of the different views of different activist. These ethics were based on the bad working conditions in India that Nike had. These were: factories, labour abuses, unsanitary conditions and forced overtime. In response to all the ethical issues, Nike implemented a code of conduct and they also dealt explicitly with labour rights in 1992. They also asked Andrew Young, an ambassador, to review the factories in Vietnam, China and Indonesia to see whether the working conditions in those countries are of a good standard. They also set out to improve the lives of workers. As a result they offered a lending program for their employees and also gave them adult education and also a better factory monitoring.
The Advertisement Standard Authority (ASA)
The Advertisement Standards Authority is about the laws that are set for businesses to follow. They’re also there to answer any complaints formed by viewers watching a TV ad. The rules are also laid down by advertising codes. They are an independent business and they’re their to ensure that all the laws are met. The strength of the business lies in both the independence of the ASA and the support and commitment of the advertising industry. The ASA main aim is to protect consumers by ensuring that the standards of advertisements are kept high whether a complaint is made or not.
Within the ASA there is the Committee of Advertising Practice (CAP), this is the CAP code rule which is to protect consumers and create a level playing field for advertisers. One of their important rules is the advertising about children. They have strict rules about advertisements where children at a certain age are involved. The ASA is also there to judge whether the ad is acceptable after a complaint has been made.