Unit A The Consumers Impact on Business 2

Unit A: The Consumers Impact on Business 2. 01 Analyze government's role in consumer protection and how it affects consumers’ rights.

Consumer Rights • The Right to Be Informed – Consumers should be given the facts needed to make informed choices and can be protected from unfair or misleading advertising, labeling, or sales practices. • The Right to Choose – Consumers should have access to a variety of goods and services at competitive prices. • The Right to Safety – Consumers should be protected against goods that are hazardous to life or health.

Consumer Rights • The Right to Be Heard – Consumers should be assured that their interests will be considered in the making of laws which might affect them. • The Right to A Remedy – Consumers should be entitled to quick, fair remedies for consumer problems. • The Right to Consumer Education – Consumer should be taught how to use the rights and responsibilities to the greatest satisfaction and failure for the money.

Consumer Responsibilities • The Responsibility to Be Informed – Consumers should compare and evaluate information on brands in models of products. • The Responsibility to Choose – Consumers should shop around to compare prices and products in order to find the best product or service at the best price. • The Responsibility to Use Products Safely – Consumer should follow instructions on package labels to safeguard themselves, others, and the environment.

Consumer Responsibilities • The Responsibility to Speak Out – Consumers should express their opinions about businesses and their products. • The Responsibility to Seek Remedy – Consumer should seek correction for products or services that are defective or do not perform as stated.

Consumer Responsibilities • The Responsibility to Learn Consumer Skills – Consumer should understand where to find information on learning consumer skills and should follow these tips: Read information on labels Compare prices Consult media for awareness of illegal practices Use consumer information publications Attend sessions on consumer issues

WHAT’S ON A LABEL? • • Brand Name Product Ingredients Product Weight Nutritional Information Directions Pricing Bar Code

Federal Protection Agencies • CONSUMER INFORMATION CENTER – Provides information on government publications on topics of interest to consumers • CONSUMER PRODUCT SAFETY COMMISSION – Promote safety from unreasonable risk of injury from products – set safety requirements – test products – conduct research and education programs

Federal Protection Agencies • U. S. POSTAL SERVICE – Enforces laws against fraud by mail – helps consumers recover money – provides information on common mail fraud scheme • FOOD AND DRUG ADMINISTRATION – sets and maintains purity and safety standards for foods, drugs, and cosmetics – researches contents for new health and drug products – inspects food and health aide plants – ensures accurate labeling – removes unsafe products from the market

Federal Protection Agencies • DEPARTMENT OF TRANSPORTATION – National Highway Traffic Safety Administration – responsible for setting requirements for motor vehicle safety, maintenance, and fuel economy – testing vehicles and other automobile products for compliance with laws – conducts research on ways to save fuel an increase highway safety – investigates consumer complaints about vehicle safety

Federal Protection Agencies • Environmental Protection Agency – Works with businesses to reduce pollution and make our environment healthier • Federal Trade Commission – Enforces laws and regulations concerning faults and unfair advertising • Department of Agriculture – Responsible for maintaining a high standard of quality in the nation’s food supply – Inspects and grades meats, fish, dairy products, and produce • Securities and Exchange Commission • Attorney General • Occupational Safety & Health Administration

State Consumer Protection Agencies • Public Utilities Commission – Regulates rates utility companies can charge; utility companies include gas, oil, water, electricity, and telephone • Weights and Measures Or Division of Standards – Maintains scales, packages, gasoline pumps, and labels to guarantee true weights and measurements • Licenses – Gives a person the right to conducting business or practice the profession • Attorney General – Protects states citizens from fraud and criminal acts

Private Consumer Protection Organizations • Consumer Federation of America – Informs the public and government about consumer issues. It has 50 million members in over 260 groups. • Consumer Reports – Magazine that reports on consumer products. Provides ratings, buying guides, product reviews, and consumer information from the experts. • Better Business Bureau – Nonprofit organization – Collects information on local businesses and handles complaints – Shares information about consumer problems – Distributes consumer publications

Unit B: The Consumers Impact on Business 2. 02 Examine purchasing decisions and various products with respect to value, service, maintenance and price.

Market Economy • Market Economy – Basic economic decisions are based on the actions of buyers and sellers in the market. – Capitalism • Price – The amount of money given or asked for, when goods or services are bought or sold. • Marketplace – Any place where individuals buy and sell goods and services.

Market Economy • Demand – The amount of goods or services consumers are willing and able to buy at various prices. • Law of Demand – Consumers will buy less of an item at a higher price than at a lower price. • Supply – Amount of goods or services that producers will provide.

Market Economy • Law of Supply – The higher the price the more producers will supply and the lower the price the less producers will supply. • Surplus – An over supply of a product. Producers are producing more of a product than consumers will buy.

Market Economy • Shortage – An under supply of a product. Consumers are demanding more of a product than producers are producing. • Equilibrium Price – The price at which the amount supplied and the amount demanded come together.

Types of Income • Nondiscretionary Income – Income used to purchase items to meet basic needs – Food, clothing, shelter • Discretionary Income – Income that is left over after a consumer’s basic needs have been met – Wants – Savings

Types of Products • Convenience Goods – Goods consumers buy regularly without spending much effort – Usually inexpensive – Ex. Milk and bread • Shopping Goods – Goods consumers buy after spending time looking around and comparing products – Usually more expensive than convenience goods – Ex. Vehicles and designer clothing

Types of Products • Specialty Goods – Goods that consumers select by brand or company which require a special sales effort – Usually expensive – Examples: digital cameras, stereo equipment, and perfume

Types of Merchandisers • Department Stores – Stores have different departments selling a variety of products – men’s, women’s, children’s clothing, home furnishings, jewelry, and services are examples – Goods are moderately priced, salespeople are in each department, special services are available (gift wrapping, delivery), elaborate merchandise displays and may even have a salon – Examples: Macy’s, Nordstrom’s, Saks Fifth Avenue

Types of Merchandisers • Mass Merchandisers – Sells a variety of items at reasonable or low prices; often are nationwide stores; practical displays and not always very organized; some service is available – Examples: Target, Wal Mart • Limited Line Retailers – Sell only one kind of merchandise – clothing stores, athletic goods stores, home appliance stores, hardware stores; services vary, selling methods and prices vary – Examples: Limited, GAP, Foot Locker, Best Buy

Types of Merchandisers • Off-Price and Outlet Stores – Off-price stores usually buy from producers with surpluses; therefore, carry manufacturers’ brands or manufacturer’s overruns – Prices are discounted at 20 -70% off; merchandise can be slightly imperfect or discontinued; limited service is available – Example: TJ Maxx – Outlet stores are operated by the manufacturer and carry only that manufacturer’s brand or an affiliated manufacturer – Examples: Nike, Ralph Lauren, Nautica

Types of Merchandisers • Superstores/Hypermarkets – Superstores: Extremely large (30, 000 sq feet), similar to supermarkets, but also sell mass merchandise items like clothing, garden products, and books; no customer services – Examples: Kroger, Safeway – Hypermarkets: Larger than Superstores (200, 000 sq feet)

Types of Merchandisers • Warehouse Stores – Huge selections of food and nonfood items at low prices and in bulk quantities – Often require memberships – Ex. Costco and BJ’s

Unit Pricing • • Product A 20 oz/$1. 15 Product B 8 oz/$1. 04 Product C 10 oz/$0. 99 Unit Price (per oz) = Total Cost / Number of Ounces • Be sure all weights are in the same unit (ounces, pounds, liters, etc. ) • Be sure to divide to 3 decimal places, if necessary.

Unit Pricing • Product A Unit Price = $1. 15/20 =. 0575 • Product B Unit Price = $1. 04/8 =. 13 • Product C Unit Price = $. 99/10 =. 099 • Product A would be the best buy at $0. 06 per ounce.