question_answer 7)

Explain the importance of consumer protection from the point of view of business.

Answer:

A business cannot survive without paying attention on protecting the consumers interest and adequately satisfying them. This is important because of the following reasons (i) Long Term Interest of Business Business firms should aim at long term profit maximization through customer satisfaction. Satisfied customers not only lead to repeat sales but also provide good feedback to prospective customers and thus help in increasing the customer base of business. (ii) Business uses Society's Resources Business organization users resources which belong to the society, thus they have a responsibility to supply such products and render such services which are in public interest. (iii) Social Responsibility A business has social responsibility towards various interest groups. Business organizations make money by selling goods and providing services to consumers. Thus, consumers form an important group among the many stakeholders of business and like other stakeholders, their interest has to be well taken care of. (iv) Moral Justification The moral duty of any business is to take care of consumer's interest and securing them from exploitation. Thus, a business must avoid insecure loss, exploitation and unfair trade ; practices like defective and unsafe products, adulteration, false and misleading advertising hoarding, black marketing etc. (v) Government Intervention A business engaging in any form of exploitation time trade practices would invite government intervention or action. Thus, it is advisable that business organization voluntarily resort to such practices, where the customers need and interests will be taken care of.