When Discounts Create Disadvantage

I started my business career in the age of "Gordan Gecko" - where "greed is good". Building the business was the priority. 

Now I am much more aware of having a "business conscience" and thinking of the impact on people and society. Learning from collateral damage. Sometimes, you only see collateral damage when walking in someone else's shoes. 

My Uncle Bill is a widower and living on the aged pension. It is "almost enough" to get by, but not really. He has to juggle and determine what he will go without each month. 

On a recent trip, I took him grocery shopping, and became aware of how the "50% off" price discount strategy is affecting pensioners (and anyone living week to week).

Historically, price promotions were around 20%. The company pays for this, not the retailer. But in the last decade, there has been a push by supermarket retailers to 50% off. It is now constant and frequent. 

But how can companies afford to fund 50% price off all the time? Well, they can't. 

So, as their P&L's were squeezed (and normal inflation and trade margin increases were added), base prices have increased. The "normal shelf price" now is so high, it's ridiculous. $36 for laundry detegent. $10.75 for deodorant. The list goes on. It's created an artificial shelf price and cycle where people pantry stock.

Here is the ethics issue though. 

✅ I can afford to pantry stock.
❌ My Uncle Bill can't. So he goes without. As he said to me - "it's just what us pensioners have to do". 

This business strategy is now hurting vulnerable people the most. I'm sure there was no intention of this at the start - but here we are. 

It was a sobering experience as we walked around the supermarket, and I experienced his reality.

I don't have all the answers either. But as we operate with more transformative change, where the impact is not predictable, ethics are so important. 

For business. For people. For society. 
For fixing it when the outcome is different to what we intended, rather than leaving it.

What examples are you seeing? What do you think?