Action 19 News in Ohio was hot on the investigative trail of a Girl Scout cookie scalper today.  Apparently, the owner of a Valero gas station in Parma Heights, Ohio bought a LOT of Girl Scout cookie boxes and is selling them in his store for $4 dollars.  Girls Scouts, on the other hand, peddle the boxes boxes for $3 dollars door to door.  Kate Donahue of the Girl Scouts of Lake Erie called the Valero owner’s actions dishonorable and dishonest. 

Dishonorable?  Dishonest?  How so? 

Now, I must concede that I am not in possession of all the facts surrounding the situation because the news clip was about two minutes long and didn’t go into much detail.  There were only two piece of information that you can really get from it.  First, the owner was buying the boxes for $3 and selling them for $4.  Second, the boxes say that resale of the boxes is unauthorized.  So, I’m running with those two facts.

From what I understand, the Girl Scouts sell boxes of cookies for $3, and the owner of the store purchased the boxes for $3 dollar a box.  Nobody was complaining about non-payment, so it was obviously not an issue.  The Girl Scouts received all that they desired for the boxes of cookies.  No dishonesty or dishonorable behavior there.

In his store, he sold the cookies for $4.  People paid $4.  People got their cookies.  From what I understand, there was no misleading signage saying anything about giving every single last dollar to the Girl Scouts.  So, no dishonor or dishonesty there. 

But what about making an extra dollar off the box?  Dawn Hendrick, the reporter on the case, brought up a good point when she asked why she had to spend $4 on a box of cookies at the Valero when the Girl Scouts were selling them for $3.  Here’s why Dawn: you bought it from a Valero and not from a Girl Scout!

There are only two types of people in a purchasing situation.  The first type of person is the type who does not know the going rate of an item.  This person has to rely on their own perception of value to determine if a price is correct.  If they want cookies, see a box, and determine that the prices is reasonable, then they purchase that box of cookies.  By purchasing the cookies, they are agreeing that the price is reasonable and correct.

The second type of person is the type who does know the going rate of an item.  If they see a price that is above the going rate, they have a decision to make: is getting the item at the current location worth the additional cost?  If it’s not, then the buyer can leave.  By purchasing the box, however, the buyer is agreeing that the extra cost is justified due to convenience. 

If you can sell and item for more than you bought it for, then you have brought value to the person buying it.  It may be perceived value, or convenience value, but you have provided value none-the-less.  Pocketing the difference is called profit, and it’s how the world works.  In fact, I can guarantee you that the Girl Scouts are not spending $3 dollars to MAKE the box of cookies that they are selling for $3.  So their stance against someone selling their cookies at a profit seems a bit irrational.  And considering that their sales force consists of tens of thousands of unpaid child laborers, I would say that they have a pretty good racket going on themselves.

My favorite part of the newscast is when a Girl Scout says “We use our money for our troop and other stuff, and he just gets it for himself to spend.”  It was meant to be a damning condemnation from the mouth of a child, and that’s how it comes across in the interview. But the reality is that shows the absurdity of the outrage towards the Valero owner.  Basically, the Girl Scouts are out selling cookies because they need money to pay for Scouting related activities.  The Valero owner is selling products at his gas station because he needs money to pay for living related activities.  So why is the Valero owner being accused of perpetuating some great evil upon the world when the Girl Scouts are engaging in the same act? 

Some would then argue that since boxes of Girls Scout Cookies say “Any Resale or Redistribution is Unauthorized” that the owner was in violation of some law.  As far as I know, the Girl Scouts do not regular commerce, and the printing on the side of the box does not constitute a binding contract.  Re-selling the item is not a legal offense.  Since he never claimed to be an “authorized” reseller, I see no dishonesty.  Some would go as far as to say that it was unethical to sell the boxes when such a message exists on the box, and thus dishonorable.  Ethics is far more subjective than law, but I would still say that this is not beyond the bound of ethics because no official agreement exists.  Unless there is an official agreement, the Girl Scouts have no right to dictate how someone uses what they bought.

I will, however, concede that selling Girl Scout cookies for a profit has the potential to cut into Girl Scout’s cookie revenue.  When someone pays $12 dollars for Girl Scout cookies from a Girl Scout, they get 4 boxes and $12 goes to the Girl Scouts.  At Valero, $12 gets you 3 boxes and only $9 dollars goes to the Girl Scouts.  But we are also talking about a luxury item, and most people are going to get however many boxes they want without much regard for the price.  As such, the lost revenue angle is not an overly compelling argument.  And remember, regardless of where you get the box from, $3 bucks DOES go to the Girl Scouts. 

Sounds to me like the Girl Scouts are unhappy because they didn’t think to raise the price to $4 a box first. 

Perhaps the real solution to the problem would be for the owner to stockpile cookies until AFTER the Girl Scouts have done all their selling.  Then four months later when everyone’s supply of Thin Mints, Tagalongs, and Somoas are depleted, put them out on the shelves for $6 per box.  I’m addicted to Somoas, so I know I’d be pretty tempted to pony up for a box.