a memo from the vice president of a food distribution companywith food storage warehouses in several cities.
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University: Jinan University
November 25, 2020 at 6:42 am
The following appeared in a memo from the vice president of a food distribution companywith food storage warehouses in several cities.
“Recently, we signed a contract with the Fly-Away Pest Control Company to provide pest control services at our fast-food warehouse in Palm City, but last month we discovered that over $20,000 worth of food there had been destroyed by pest damage. Meanwhile, the Buzzoff Pest Control Company, which we have used for many years, continued to service our warehouse in Wintervale, and last month only $10,000 worth of the food stored there had been destroyed by pest damage. Even though the price charged by Fly-Away is considerably lower, our best means of saving money is to return to Buzzoff for all our pest control services.”
In the memo from the viece president of the food distribution company, he mentioned that they should spurn Fly-Away Pest Control Company and return to Buzzoff Pest Cotrol Company to save money, because Fly-Away Company had a doubled number of worth of the food stored there destroyed. Altough the president had provide some information about his choice, I consider we need more evidence to evaluate the conclusion.
To begin with, while we have informed that Fly-Away Company charged a considerably lower price for the storage service, we need the exactly number of the price of two companies. The food distribution company lost $10,000 more in the storage offered by Fly-Away Company, but if the service price of Fly-Away Company is $10,001 lower than the Buzzoff Company, this kind of evidence will certainly weaken the president’s argument. We need further evidence about the difference between two companies’ prices to evaluate the conclusion.
In addition, assume that the gap between two offered price is less than the lost worth of food in last month, more evidence about the daily storage circumstances of two companies is necessary. It is possible that Fly-Away Company had encoutered some emergencies thus acted worse than their daily level. And the circumstance that Buzzoff Company coincidently operated extrodinarily well last month and caused lower lost than before is also possible to occur. The evidence about two companies operation situation is also needed for further evaluating.
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