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Ethical Analysis, Essay Example

Pages: 1

Words: 376

Essay

Sometimes a business is not valued because it offers a unique product but instead due to its rich heritage and Claudio Caponigro’s barbershop exactly fits the description of such a business. The building’s new landlord has raised the monthly rent to $1,650 and Mr. Caponigro can’t afford it. Mr. Caponigro wants to stay in the business for another year and he has now two choices; either quit the business or raise the prices of his services in order to be able to afford the new monthly rent of $1,650.

The best solution for Mr. Caponigroshould be the one that maximizes the collective benefits of all the stakeholders involved, i.e. the landlord, Mr. Caponigro himself, and the customers.If Mr. Caponigro raises the prices of his services, he will be able to do what he loves for another year. The customers will get to enjoy another year of an affordable luxury and the landlord will get his desired rent. Many of Mr. Caponigro’s customers come from low economic backgrounds and similar old fashioned barbershop services cost many times more at other places. The downside is that Mr. Caponigro will feel guilty about charging more and may not enjoy his last year as much as he could have otherwise.

If Mr. Caponigro quits the business, his career will end on a bitter note and the customers will lose an affordable luxury. The positive outcome is that the landlordmay be able to rent the shop at a higher monthly rate.

The best possible solution that would maximize the interests of all stakeholders is for Mr. Caponigro to raise the prices of his services. Mr. Caponigro’s $10 haircuts are cheap even by the standards of low cost regions in the U.S. If Mr. Caponigro raises the price of a haircut to $15 and gives ten haircuts a day, he will earn $50 more on a daily basis and cover the approximately $1,000 additional rent in just twenty working days. Mr. Caponigro will get to stay in business, the landlordwill get his desired rent, and Mr. Caponigro’s customers will avoid losing an affordable luxury. It is also possible that the landlord allows Mr. Caponigro to stay in business for as long as Mr. Caponigro desires because the landlord would be getting his desirable rent now.

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