I admit I was astonished by the blatant self-interest and attempt at manipulation of consumers that John Schnatter, CEO of Papa John’s Pizza, offered recently, saying that he would pass on the cost of Obamacare to consumers in the form of pizza costing at least $.10 and perhaps as much as $.20 more.
This is a man whose annual salary is well over $2 million, but who resents having to provide improved healthcare to his employees and will penalize his customers rather than see a slight reduction in his own enormous profits.
Those who are concerned about ethical matters could already find much to object to. Personally, I would rather pay more for pizza and other products to a company that I know is dealing ethically with its employees.
But one doesn’t have to be an ethical consumer to balk at Schnatter’s attitude. You just have to be an intelligent one.
Most of us discovered long ago that there are two different ways to maximize profits in the business world. One is to cut corners wherever possible so as to appeal to those who care only about paying low prices, and also maximize your own profits. What thinking consumers know is that, if you resent having to give your employees health insurance and do it only because the government requires you to, then you probably would also happily not keep your cooking area clean, since paying someone to clean it is money that would otherwise be profit. Those who take this approach will maximize profits whenever possible, and so will offer me as low a quality of product or service as they can get away with. If they will cut costs rather than take proper care of their employees, then what sort of care will they take of me, the customer?
The other approach knows that there are consumers who would rather pay more for a car that will run well than pay less up front for a car that will cost more in repairs in the long run. We would rather pay more for a pizza that is made well than less for one where the concern was to maximize a CEO’s profit. And ultimately, because a company realizes this, they make money. But there is a recognition that a successful business involves a compromise between the need to make a profit and the consumer’s desire that enough be spent on giving us a high-quality product.
You don’t need to be concerned about ethics to find Schnatter’s attitude objectionable. Being a self-interested consumer ought to be enough.
But I am not just someone who tries to be a smart consumer. I am also an ethically-concerned one. And so I will be listening carefully to hear what other pizza companies that want my business have to say.