Triangle Principle Agent Relationship

I have personally experienced the triangle relationship between the principal agent problems in my previous employment. In particular, I had summer job in which I worked as a cashier at a local convenience store. This was a job in which I assumed a lot more responsibility that I had initially thought. I worked primarily night shifts, which meant that I had to essentially run the entire store by myself. Since there was only one worker in the store during this shift, I had to assume the responsibilities of running the store as well as taking care of the customers. Essentially, I experienced the principal agent problem with trying to be an agent to my boss as well as the customers. There was a clear distinction between what specific customers wanted and the expectations from my boss.

More specifically, I acted as an agent between my boss and the customers. My boss would leave me specific set of instructions each night such as managing inventory, stocking the store, paper work, or clean up. The main concern of my boss was to keep the store running at all times and to make sure that everything goes smoothly. Often times I would have to take inventory for current products and then make orders electronically for various items. For example, I would have to take inventory of alcohol products and make a purchase for those items that would potentially run out that week. Since we carried a variety of products from food, alcohol, to cigarettes we had to constantly keep inventory managed in order to make the store run smoothly. Since the convenience store that I worked at was a franchise, there was one main distributor that the store purchased from. There were incentives to purchase specific items and sell them in the store such as for promotional purchases. These were the items that my boss would incentivize me to sell. Certain contracts gave special discounts for the sale of certain products so these were the products that my boss would tell me to try and entice the customers to sell.

On the other spectrum, I would deal with customers on a daily basis. Often times these customers were my regulars. I would build a relationship with these certain people that would come in on a regular basis. These were the type of people that would stop in and would take the time to talk to me. In addition, these customers would often times give me their input on specific products that they would like to see in the store. For example one particular brand of cigars would sell very fast whereas others would sit on the counter for months at a time. When I would try to communicate to my boss these suggestions, there would be a mix of attitudes. While my boss sometimes respected my input, there were other times in which they would simply be ignored because of the protocol of the franchise. There was definitely a conflict between what certain products consumers demanded and the choice of products that my boss made from a higher up position in this organization. The main issues that arose because of this triangular principal agent problem came from asymmetric information between the various principals. There is a discrepancy between what consumers demand and the information about various contracts and promotions. While I looked to satisfy the party of my boss, I sometimes felt pressured to agree with my customers. I would definitely try to actively sell the products that had a promotion. It became difficult at times trying to explain to my customers why my manager wouldn’t take the advice of multiple customers.