The following appeared in a memorandum from the owner of Movies Galore, a chain of movie-rental stores."In order to stop the recent decline in our profits, we must reduce operating expenses at Movies Galore's ten movie-rental stores. Since we are famous f

Essay topics: The following appeared in a memorandum from the owner of Movies Galore, a chain of movie-rental stores.
"In order to stop the recent decline in our profits, we must reduce operating expenses at Movies Galore's ten movie-rental stores. Since we are famous for our special bargains, raising our rental prices is not a viable way to improve profits. Last month our store in downtown Marston significantly decreased its operating expenses by closing at 6:00 P.M. rather than 9:00 P.M. and by reducing its stock by eliminating all movies released more than five years ago. By implementing similar changes in our other stores, Movies Galore can increase profits without jeopardizing our reputation for offering great movies at low prices."
Write a response in which you examine the stated and/or unstated assumptions of the argument. Be sure to explain how the argument depends on these assumptions and what the implications are for the argument if the assumptions prove unwarranted.

Wajiya Zafar's picture

The author hastily puts forward two solutions to increase profit at Movies Galore rental store. Firstly, operating expenses should be cut down. Secondly, old stock of movies should be removed. At first glance, the authors argument seems somewhat convincing but further reflection reveals that the statement omits some substantial concerns that should be addressed and thus not cogent enough to substantiate the argument. At least, this argument suffers from three main logical flaws.

To start with, the author’s assumption that reduction in operating expenses can stop the recent decline in profit is unwarranted. If according to the stated elucidation, the store activities are seized three hours earlier, people wishing to relax after office hours can be deprived of entertainment. They can look for other stores that can provide them with some good relaxing movies. If this be the case, the income of rental movie store will automatically decrease. Operating expenses can be decreased by limiting the glamor of the store or the workforce. The author needs to have a comprehensive study of expense sheet and can think of other ways to control expenditures.

In addition, the author also proposes to have the stock of movies released not older than five years. The author has failed to consider that super hit classic movies of all times are evergreen. People find pleasure in watching old movies and if they will not be available at Movies Galore rental store, the customers will definitely change their choice to some other movie store that can fulfill their demands.

Finally, the author assumed that implementing the same measures as done in the store in downtown Marston will be beneficial in raising profit. However, it is not a well-thought-out assumption. It may be possible that people residing in downtown Marston are not very fond of movies which may not be the case at other rental stores. The author has failed to discuss other factors that can help raise profit with same working hours. May be more customers can be attracted by effective advertising or entertaining customers with special offers on movies rent.

To sum up, the author fails to substantiate his claim that the profit can be boosted by lessening the working hours or reducing the stock, because the proofs referred in the analysis do not lend strong support to what the author maintains. Without additional evidences, however, we should be very circumspect about accepting the truth of the author’s conclusion.

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