Taking Business From A Friend

Jared's friend is starting his own business after being laid off. Jared worries that he might be taking money away from his friend by underbidding for contracts. Should he be concerned about this?

QUESTION: Jared in Colorado is in the IT industry and also does side work. His friend is starting his own IT business after being laid off. He worries that he might be taking money away from his friend by underbidding for contracted services, especially since he isn’t as pressed for money as his friend. Should he be concerned about this? Dave talks to him about it.

ANSWER: I don’t know that it’s as much an ethics question as a relationship question. If you change a few of the issues, the ethics go away very quickly. If you didn’t know the guy, there is nothing unethical about what you are doing. It’s not unethical because you happen to know him.

As a friend, how would you like to be treated if the shoe was on the other foot? If I’m bidding against you and you are trying to feed your kids, you’d probably like me to cut you a break, at least every so often so the kids don’t get too skinny. I think it’s that more than anything else.

This sounds like a deep business friendship with a little personal friendship on the side. I’d have a cup of coffee with him and just tell him what you’re thinking. Tell him you don’t want to do anything to hurt him, and you know he’s trying to feed his kids. You are trying to earn some money, and you have a lot of respect for him and you don’t want to do anything to damage your relationship.

Just talk it out with him, but I don’t think that’s an ethics breakdown. I do think it’s a relationship issue, and you want to ask yourself how to treat this relationally. But you are not doing anything that’s “unethical.”