Question
Mr Lee has a stall selling chicken rice at Beach Road market. Many of his customers are elders. The business has been slow lately, and Mr. Lee is financially struggling especially with the recent inflation.
Mr. Lee’s son just graduated with a business degree. Mr. Lee asked his son for business advice. The son advised Mr. Lee that people are becoming more socially conscious and it could be a good idea if the business becomes a social enterprise with a social mission/impact. The son further advised that helping the elders is something that relates well with the public.
Mr. Lee currently sells a plate of chicken rice for $5 and the cost (excluding fixed overheads like rental) is $3 per plate. Mr. Lee decided to implement the following:
- Increase the price of the chicken price plate to $8. The costs remain the same at $3. Mr. Lee believes the customers (except the elders) would be comfortable paying the new price.
- Offer a 50% discount to seniors above 60 years old
- Donate 20% of his net profits to charities for elders.