Q. The policy at our store is to tell the truth and nothing but the truth, but not necessarily the whole truth. We tell customers when an article isn't suitable for their needs, and avoid encouraging them to spend beyond their means. But we never tell them that they could get something more suitable, or less expensive, at a competitor. Can I follow this policy?
A. In order to answer your question, we have to clarify a key distinction in Jewish business ethics: the difference between a seller and an adviser.
When you are a seller, everyone understands that your interest is to show the customer the ways in which your product can benefit him. That doesn't mean that anything goes; Jewish law categorically rejects the idea of caveat emptor, or "buyer beware." The seller is obligated to inform the shopper of any defects in the merchandise, and his answers to shopper questions must be truthful. It is forbidden to mislead even in a passive way -- for example, to take advantage of a customer's error in understanding what a product can do for him even if you didn't create the false impression yourself. (1)
However, there is no presumption that the seller is any way impartial or unbiased. The seller's job is to be an advocate for his product. Just like the other kind of advocate, a lawyer, he has to be honest but not impartial. It is the judge, in this case the customer, who is charged with making a wise and impartial assessment of the evidence.
This compares starkly with an adviser. When your job is to give advice, it is completely forbidden to show partiality to one side. The Torah commands, "Don't place an obstacle before the blind" (Leviticus 19:14). Rashi's commentary explains: don't give inappropriate advice to a blind -- that is, unknowing -- inquirer. "Don't tell him, 'Sell your field and buy a donkey,' when you are scheming to purchase it from him."
Rashi gives a specific example of bad advice, namely a conflict of interest. But any time advice is not truly impartial he violates this prohibition.
It follows that the policy you describe is a perfectly ethical one. But one pitfall must be avoided: salespeople must never give the impression that they are indeed acting as impartial advisers, rather than as interested advocates. Some salespeople adopt subtle ways of trying to convince the customer they are interested only in the customer's best interest. Using words like "I recommend" or "trust me" are danger signs. A salesperson is allowed to make pertinent and verifiable comparisons between his service and a competing one (more horsepower, longer warranty, etc.), but vague declarations of the superiority of your product or of the inferiority of the competitor, belong in the realm of judgment and are appropriate only for an adviser. Being friendly is certainly in order, but crass attempts at ingratiating yourself with the customer, emphasizing that you went to the same college, belonged to the same fraternity, attend the same house of worship, etc. are often meant to hint that you are "on the customer's side." This would obligate you to act in an impartial way -- a virtual impossibility for a salesperson.
Of course the worst infractions come when the "adviser" masquerade is not even so subtle. A few years ago there was a scandalous situation where some banks in Israel had a person whose official title was "investment adviser," but in fact the job was to try and promote the bank's own products. (This practice has now been outlawed and abandoned.)
So as long as your store has some product which meets the customer's needs, your salespeople are justified in explaining how your merchandise can help the customer. You have no obligation to point out that you are not offering the best deal. You just must be careful not to give the impression that you are being impartial and advising, for example by telling the customer that you are giving him "the best deal."
If your store is unable to provide anything to help a customer, it is my opinion that it is both good ethics and good business to steer him to another store, even a competing one, which can help him.
SOURCES: (1) Shulchan Arukh Choshen Mishpat 228.
The Jewish Ethicist presents some general principles of Jewish law. For specific questions and direct application, please consult a qualified Rabbi.