Making a Fair Profit

Proverbs 11:1:  "Dishonest scales are an abomination to the Lord, but a just weight is His delight."

When you buy a pound of coffee, a pound of lunchmeat, a pound of bananas, or whatever, are you really getting a pound?  How about gasoline?  Do you get an exact gallon of gas just because the pump screen says you do?  Thankfully in America, the National Institute of Standards and Technology carefully defines units of measure that are the legal standards for commerce.  Retailers are required to use "honest scales" that are calibrated, checked and certified to be accurate.  Our laws are pretty strict when it comes to weights and measures.  This verse makes it clear that dishonest scales are also an abomination to the Lord.  The Book of Deuteronomy makes it even clearer that the Israelites were not to have differing weights in their bag, a heavy and a light, or differing measures, a large and a small, but they were to have a perfect and just weight and measure."  God puts a pretty high premium on integrity in business practices and looks at dishonest business practices very seriously.  Notice this verse does not pinpoint any particular group.  Dishonest scales are an abomination, whether you are Jewish, Christian or profess to be nothing.  He does not differentiate when it comes to dishonest scales.  God hates deceitfulness and deception of any kind when it comes to how we are transacting business.

You are probably already thinking, 'what does this verse have to do with the topic, making a fair profit?'  It has everything to do with it.  You see, if you alter the weights on a scale, and you give 15.5 ounces for a pound of a product that costs $1.00 a pound, you are increasing the profitability of that product by 3.2%.  If you weigh that same item 32 times and give 15.5 ounces each time for a pound, you will have saved an extra pound thereby increasing your profit. 

What is a fair profit?  Isn't that a subjective question?  What is fair to one person may not be fair to someone else.  I believe the verse is speaking directly to the subject of profits, emphasizing the importance of making a profit fairly.  The fundamental rule of capitalism is, "profit, but fairly," but making a profit "at any cost" is not fair.  When the sole intent of a business is to make money for the stockholders regardless of what it does to a people and its culture, the quality of the product itself, or even the effects on the environment, is that still making a fair profit?  Too often, we want to point at the obscene profits of Big Oil or Apple or Microsoft, but before you pick up stones, if you have a Retirement Fund or 401K, aren't we primarily only interested in growing that nest egg, and don't those investments grow as a direct result of the growth in that particular companies' profits?  Is ignorance bliss with regards to this?  We don't know if the profits made on our mutual funds were fairly made or were they profits made at any cost.  Thought provoking to say the least, but I don't think this blog will settle this emotionally volatile issue.  The differentiation between earning profits fairly and earning profits at any costs is starting to work its way into the curricula of business schools.  "Business schools are moving beyond business as usual. Across the country, MBA programs have responded to growing criticism that graduates are fixated foremost on shareholder profits. Amid the unending financial scandal and the worst downturn in decades, the curriculum has shifted toward sustainability, long-term profitability, and integration of specialties. The question is how deep the changes will go." (Bloomberg Business Week, 11/10/11, "Business Schools' New Mantra:  Ethics and Profits")

I think the broader topic in our text this week is whether one is honest or dishonest in business, period.  Don't you think that God's opinion would be the same?  Absolutely!  Let's consider some examples of dishonest scales in today's business world.

If you are in sales, (I'm sorry salesperson.  Why do we always have to start with you?) would deceptive sales techniques, overpromising on a product or a service and other forms of stretching the truth, not be the same as dishonest scales?  I bought a vehicle a little over a year ago.  I went ahead and purchased the "lifetime limited warranty" too.  While I was in the decision making portion of the transaction, all I was hearing from my salesperson and even the owner of the dealership was the virtues of this extended warranty.  I knew, and they even explained to me that maintaining the service on the vehicle was key.  Once I made the purchase, the doublespeak started.  Three different people at the dealership, the owner, my salesperson and the service manager, told me something differently, as to when the oil should be changed to maintain the warranty.  What's worse, the emails direct from the manufacturer and the owner's manual said something different too.  What happened here?  If you don't keep up the maintenance, the warranty is voided.  Getting 3, 4 and 5 different answers to the same question, do you think they were trying to confuse when the maintenance work should be performed?  Sounds like a dishonest scale to me. 

I believe a salesperson can be honest and maintain his integrity.  You don't have to compromise to be in sales and marketing.  I love being a marketer, and I want to be known as the ethical marketer.  Gaining the trust of your customer is huge.  Remaining honest regardless of the consequences will only solidify that trust.  Be deceptive once, and that trust can be lost in an instant. 

Here is another one.  Have you noticed the theme of car insurance commercials lately?  "Just fifteen minutes, can save you 15% or more..."  You've heard them.  Each one is promising to save more than the other competitor will save you.  Here is something you can try.  If you switch from Company A to Company B, you can save, let's say $300, but if you switch from B to Company C, they will save you $300 more than B, and if you switch to D, they will save you $300 more.  Get the point.  Do you think if you keep switching, that ultimately the price will get down to $0?  Of course not. 

Now I know not everyone is in sales, but everyone is a buyer of goods and services.  Negotiating price is okay, and has its place, but if you pay less than the honest value of an item, do you feel that you got away with something?  How about when you thought you paid for an item, and you find out that the clerk forgot to charge you for it?  How does that make you feel?  It's there loss, you say.  Isn't that an example of dishonest scales?

I have one more, and I'm done.  This one happened to me over 30 plus years ago, and it still bothers me when I think about it today.  I had a young family then, and I wasn't making a whole lot of money.  I remember going to the bank to cash my payroll check.  I pulled up to the drive up window.  When the bank teller gave me my cash, I took the envelope and left.  When I opened the envelope, I realized she had given me $20 more than she should have.  What did I do?  What should I have done?  I must confess.  I kept it, and thought no more about it, or at least I tried to convince myself of that.  Wasn't my action an example of a dishonest scale?  Since then, I've found out that when a teller is short or over on cash that there is a massive effort by several bank employees to find out if a transaction was missed or something was miscounted.  Even worse, if the particular teller I had that day had made other transaction errors, she could have been on probation already, and my gain of an extra $20 could have resulted in the loss of her job.  I never knew what happened to her.  If memory serves me correctly, I think I started using a different branch.  Do you think guilt might have driven me to another branch?

The Lord delights in just weights as the verse says.  He is looking for us to be honest in all of our business dealings, so that making a fair profit is honorable.