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The Coal Merchant

There once lived a coal merchant who had a shop in a village.


Every day, the coal merchant would purchase coal from his suppliers at Rs100 and sell at Rs150, making a profit of Rs50. He wanted to grow and was impatient to increase his profits.


One day, an old friend stopped at his shop and made him an extraordinary offer: ‘I will sell you coal at Rs50’, he said.


Unable to conceal his excitement, the merchant asked him ‘How will you do it? The market rate is Rs100, why are you selling at Rs50?’


The friend looked around to make sure that no one was listening, he bent closer to the merchant and whispered in his ears: ‘this coal is very low quality but your customers wouldn’t know. They are little black rocks after all’


After seeing his friend off and tempted at the additional profit that he could generate, the merchant turned to his father.


‘The objective of business is to make profit, isn’t it?’ he asked his father.


‘Sure’ his father answered.


‘…and to grow your business, you need to make more and more profit’ he said further.

‘Yes’ said the father.


‘My friend is going to supply me coal at half the price. It is low quality coal but it will double our profit’ said the son, ‘I am confused. Is it dishonesty to try and increase your profit? We are not here to do charity either, are we?’


‘No, you are right, we are not here to do charity. We run business and profit is our right. But, What is the customers right?’ asked his father.


‘To get coal’ said the son.


‘Not just that. It is to get the benefit of the coal. They pay so that they can burn this coal and use that energy to make their lunch’ said the father, ‘right now, you are extracting the price for the coal and delivering the benefit of the coal to the customer. If you buy the bad quality coal, you are still extracting the price but are you delivering the benefit? Will the customer, after buying the bad quality coal, get the energy that they paid for?’


‘That is dis-honesty son. Seeking to exert your right and ignoring the customer’s right. Seeking to create profits without delivering the benefits.'

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