Question 12.
Saroj, the new Chief Financial Officer (CFO) at the steel plant, used the services of Manoj when he first travelled from the Michaelganj airport to the plant. Manoj was a rival of Prabhu in the taxi service business at Kasta. Manoj, upon learning that Saroj would be responsible for hiring taxi services for the steel plant, charged Saroj only Rs. 1500 for that trip. Further, he assured Saroj to charge the same for a one way-trip and additional Rs. 500 for a round trip to the airport.
Upon realizing that the plant utilized Prabhu’s services for all official trips to the airport, Saroj contacted Prabhu to discuss the rates offered by Manoj and inquired why the plant should continue using his service when Manoj provided the same at a lower price. Prabhu realized that Manoj charged an extremely low price just to push Prabhu out of his business in the Steel Plant.
Which of the following reasons given by Prabhu will BEST help his cause?
Upon realizing that the plant utilized Prabhu’s services for all official trips to the airport, Saroj contacted Prabhu to discuss the rates offered by Manoj and inquired why the plant should continue using his service when Manoj provided the same at a lower price. Prabhu realized that Manoj charged an extremely low price just to push Prabhu out of his business in the Steel Plant.
Which of the following reasons given by Prabhu will BEST help his cause?
A
Prabhu should warn Saroj that Manoj’s offer is not sustainable.
B
Prabhu should request Saroj to talk to a few of his colleagues before taking any decision.
C
Prabhu should introduce Saroj to Ms. Nidhi Tawde, his regular customer.
D
Prabhu should offer to lower his price to the one offered by Manoj, exclusively for the steel plant.
Question Explanation
Text Explanation
The key thing to understand here is that Saroj is a new person in town. He is not familiar with the reliability of Prabhu's service. The reason given by Prabhu should be enough to convince him to trust Prabhu over Manoj, both of whom are equal in his eyes at the moment.
Let's look at the options individually.
Option A: Talking about the economic side of things might help Saroj, being a CFO, understand that the model offered by Manoj would actually not be sustainable and the prices would go up sometime down the line. But this does not mean that they cannot use the service until it's available at a lower price. As soon as Manoj increases his prices, someone (the market) would come again with lower prices to make Manoj go out of business, and they can avail the lower prices again. So this reasoning does not help Prabhu in convincing Saroj; the steel plant can always keep choosing the lowest prices available.
Option C: Although Ms. Nidhi Tawde might vouch for Prabhu's services' safety and reliability, she is as much a stranger to Saroj as Prabhu. Although her statement might add one perspective in favour of Prabhu, this would not be enough to convince Saroj of the positive aspects of Prabhu's services.
Option D: Although this might convince Saroj to choose Prabhu, this would not be a sustainable option. Not only would it hurt Prabhu, but as soon as Prabhu would want to increase his prices, Saroj would go back to other service providers who would be charging less.
Option E: Talking negatively about Manoj would not convince Saroj, as again, from Saroj's perspective, both Manoj and Prabhu are offering their services and would claim to be more reliable than the other.
The only way Saroj would be convinced would be if someone whom Saroj would find reliable vouched for Prabhu's reliability. With his reputation and his time working for the official trips for the steel plant, there would be a lot of employees who would have travelled with Prabhu and would be familiar with his reputation. If Prabhu asks Saroj to discuss with his colleagues, as suggested in option B, who would vouch for Prabhu over Manoj, Saroj would be convinced to keep using Prabhu's services even at a higher price.
Therefore, Option B is the correct answer.Video Explanation
The key thing to understand here is that Saroj is a new person in town. He is not familiar with the reliability of Prabhu's service. The reason given by Prabhu should be enough to convince him to trust Prabhu over Manoj, both of whom are equal in his eyes at the moment.
Let's look at the options individually.
Option A: Talking about the economic side of things might help Saroj, being a CFO, understand that the model offered by Manoj would actually not be sustainable and the prices would go up sometime down the line. But this does not mean that they cannot use the service until it's available at a lower price. As soon as Manoj increases his prices, someone (the market) would come again with lower prices to make Manoj go out of business, and they can avail the lower prices again. So this reasoning does not help Prabhu in convincing Saroj; the steel plant can always keep choosing the lowest prices available.
Option C: Although Ms. Nidhi Tawde might vouch for Prabhu's services' safety and reliability, she is as much a stranger to Saroj as Prabhu. Although her statement might add one perspective in favour of Prabhu, this would not be enough to convince Saroj of the positive aspects of Prabhu's services.
Option D: Although this might convince Saroj to choose Prabhu, this would not be a sustainable option. Not only would it hurt Prabhu, but as soon as Prabhu would want to increase his prices, Saroj would go back to other service providers who would be charging less.
Option E: Talking negatively about Manoj would not convince Saroj, as again, from Saroj's perspective, both Manoj and Prabhu are offering their services and would claim to be more reliable than the other.
The only way Saroj would be convinced would be if someone whom Saroj would find reliable vouched for Prabhu's reliability. With his reputation and his time working for the official trips for the steel plant, there would be a lot of employees who would have travelled with Prabhu and would be familiar with his reputation. If Prabhu asks Saroj to discuss with his colleagues, as suggested in option B, who would vouch for Prabhu over Manoj, Saroj would be convinced to keep using Prabhu's services even at a higher price.
Therefore, Option B is the correct answer.
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