Trust and Loyalty

    For entrepreneurs, trust is one of the most valuable commodities in the world.  Without the trust of the customer base that a business will engage and be true to the letter of a contract, the business will be unable to close any deals and see their sales drop off a cliff.  With more trust, business will find that it takes less and less effort to convince a prospective client to do business.  The business will either be able to charge a premium over the rest of the market or the business will find that it has time to close a much larger volume of business.  Enterprises that have the trust of the market find themselves with much larger profit margins.

    For entrepreneurs, loyalty is the equivalent of the cash cow.  When businesses have customer loyalty, those customers will come back again and again without any advertising effort required.  These customers are the business's equivalent of a steady paycheck.  It reduces the risk factor in forecasting cashflow, business growth, and profit and loss, and makes it easier for a business to plan its growth.

    Trust and loyalty are important in deciding who is profitable and who is able to stay in business.  They are really important factors because consumers suffer less worrying about being swindled or will save money by not having to investigate the business for proper business conduct repeatedly or they know that they can get their grievances addressed quickly by the trustworthy merchant.  Trust and loyalty is mostly created through a history of social relationship.  So factors outside of just entrepreneurial excellence often play a role.  Maintaining a neighborhood presence like running the corner store or forging casual friendship with prospective clients also play a role in creating trust and loyalty.

    Trust and loyalty play an important role in preventing the social injustice of swindled customers, but there are many ways for trust and loyalty to result in social injustice, with racial prejudice and self-segregation being some of the most prominent ways that trust and loyalty could be bestowed or denied solely on the basis of race.  In a free society, trust and loyalty are valid mechanisms for filtering out social contact of which economic relations are a subset.  So how does freedom or capitalism correct for racial discrimination in the form of trust and loyalty?