(Original post by oli_042)
Hey yeah I've made some notes on this, haven't done an actual essay on it though! I've planned to write a short intro on the current problem with the current fee structure e.g. poor cash flow with losses of approx. £8,125. I then moved onto talk about the fee structure very briefly.
Then I would do a paragraph on how competitors would possibly react to this due to SLSL having monopolistic competition, and the barriers to entry/exit being low meaning many competitors, and if these competitors don't charge the 20% at the beginning like SLSL are planning to do, they may take SLSL's business away from them, thus making SLSL lose business (lose out on achieving their financial objective too) you could mention.
I would then make another paragraph talking about the difficulties of what exactly SLSL should charge each customer, as SLSL obviously will not know the price of the house the vendor will be selling, etc, however a solution to this could be a flat rate of say £400, £500, but the question is, not all vendors, especially those with low income will be able to afford this flat rate at the beginning, which is a problem.
Finally I would write a paragraph on maybe the 20% being paid when an offer is made, which is payable on day 77, and is earlier than SLSL are currently receiving payment.
However an issue SLSL would have with this is that what would occur if say, the sale fell through? Would SLSL retain the money to cover their own expenses? Give it back? Etc.
Evaluating, I would talk about the reaction of competitors being the most important problem identified, as if SLSL's competitors do not implement a similar fee structure and SLSL doesn't explain why their business is better than others by demanding this 20% up front, then this will mean Alistair's proposal will, if implemented, lose business for SLSL.
Sorry if that seems long winded
Hope it helps
Just realised also the question I wrote the notes for was worded: "Evaluate Alistair's proposal to change SLSL's fee structure" so it may be a little different to your question, but seems pretty similar