Final answer:
Positive customer relations promotes loyalty and repeat business, which are essential for building a good reputation and can result in higher prices and profits. Customers' trust in a business's reputation means they worry less about product quality, benefiting the business and its employees.
Step-by-step explanation:
Positive customer relations encourages loyalty and repeat business. The rationale for this practice is that firms aim to have repeat customers, who are likely to recommend the business to others, thereby establishing a good reputation. This reputation is invaluable, as it ensures customers have confidence in the quality of the products offered, leading to potentially higher prices and greater profit margins compared to competitors with less established reputations.
For example, a well-known grocery store with a positive reputation can charge more than a temporary stand at a farmer's market, because customers trust the store's commitment to quality. Moreover, employees of businesses that offer better or more affordable products typically earn more, suggesting that positive customer relations can also contribute to the well-being of the workforce.