PROGRAMME
:Bachelor of Commerce in Retail Management
MODULE
: Ethics and Conduct in Retail (Retail Management 3B)
YEAR
: Three (3) Semester 1
INTAKE
: January 2025
LECTURER
: Stanley Nhamoinesu
NAME
: Hlengiwe Gladness Nzuza
STUDENT NUMBER: 181917
ID NUMBER
: 8206170491083
Case Study
Question 1
Analyse the ethical and economic implications of the Shein case, where the Chinese fast-fashion retailer
is being investigated for potentially exploiting tariff loopholes meant for small amounts of goods on an
industrial scale. Apply the relevant ethical theories to assess whether Shein's practices are morally
justified, considering the impact on local industries, employment, and global competition.
Ethical and economic implications:
In the Shein ethical implications are that they have unfair advantages over other businesses as they get
to avoid paying the tariffs that they are supposed to be paying and in doing so they get to save money.
Other businesses are paying the tariffs so it is only right that Shein should also pay these tariffs.
Furthermore, tariffs are a form of tax so by exploiting these loopholes, Shein is in fact avoiding paying
tax which could have a legal impact.
Economically by Shein not paying the correct tariffs, they are in fact robbing our government as paying
the correct tariffs ensures that businesses and individuals comply with legal obligations and contribute
to the sustainable funding of public services and infrastructure.
According to Utilitarianism: Each individual’s actions will be based on providing the greatest good to the
greatest number of people; Shein’s practices are justified as they ship to more than 150 countries, some
of these countries being very poor. Locally produced goods are very expensive, more especially clothing.
Shein is catering to all LSM’s and local stores like Woolworths or Foschini only cater to the higher LSM.
Furthermore some people order from Shein in bulk, in order to resell those clothes and make an
income. Yes local businesses are suffering due to Shein exploiting tariff loopholes, however a great
number of people benefit from Shein and not just in South Africa, but other countries too.
Question 2
Analyse any five (5) ethical challenges that Shein might face when dealing with suppliers and customers.
Discuss how Shein could ensure that their decisions are ethical and provide examples of how a manager
should approach these ethical issues to maintain integrity and trust in the business.
Five ethical challenges that Shein might face when dealing with a customer
Non disclosure of information that might affect a sale- As a business there are some things that you
cannot disclose to a customer as doing so might cause a loss of a sale.
Advertising a product as marked down when its not- Many companies advertise products as marked
down when they are not. This is done to attract extra sales and make a bigger profit.
Pressuring the customer to purchase an item when you know its not good for them- pressuring
customers to buy items with a promise that it might change their lives for the better, i.e a waist trainer
will make your waist smaller when infact it will not.
Selling product bought from disreputable supplier such as clothing produced by child laborers’ Lying to a customer – Saying that an item is out of stock when you have reached the maximum number
of iyems you are willing to sell at a lower price .
Shein should ensure that their decisions are ethical by considering all the stakeholders. By now Shein is
aware that they have a problem and therefore should evaluate what alternatives they have , make a
choice between the alternatives and implement the one that has a better outcome for all involved.
As a manager one should approach such issues with transparency. When you are transparent you make
it easy for your customers to trust you as transparency leads to open communication which in turn
allows for an open and honest relationship. By approaching such issues in such a manner allows the
business to maintain its dignity and trust.