An Analysis of Corporate Social Responsibility and Role of Intermediaries for Value-Added Services

Abstract

Consumers represent the largest market segment by total population and frequency of transactions across the global economy. However, many potential customers of products are unable to purchase goods due to their low income. The root causes of poverty are explored in terms of consumer products, the role of intermediaries, and the social responsibility of corporations. Consumer purchases often travel through intermediaries that extract profits from the value chain because of market structures and industry customs. This study reveals the hidden costs to consumers in the prices of common fungible consumer products, namely disposable batteries. This study examines the members of the value-added chain, and their contributions relative to the producers of the product. It will propose a model for transactional reallocation with respect to the marginal utility of intermediaries and the final price to end users. It is further proposed that the creation of a national market to reduce intermediary costs will more readily link final users with producers. Based on this analysis it was determined that opportunities exist to create greater profit margins for manufacturers who could then increase capital expenditures, reinvest in research and development while providing greater wages to unskilled labor.