Dear Experts,
Will really appreciate if you can rate and provide feedback on my first AWA.
Can you also let me know how frequently should i practice writing AWA's. My exam date is still 3 months away. Thanks.
============ Question ==========
The following appeared in a memo from the regional manager of Luxe Spa, a chain of high-end salons.
Over 75% of households in Parksboro have Jacuzzi bathtubs. In addition, the average family income in Parksboro is 50 % higher than the national average, and a local store reports record-high sales of the most costly brands of hair and body care products. With so much being spent on personal care, Parksboro will be a profitable location for new Luxe Spa - a Salon that offers premium serivces at prices that are above average.
============ My Response ========
Author of the argument concludes that Luxe Spa would be able to make profit in Parksboro based on certain assumptions related to the occupant’s average income, purchasing habit’s and bathing lifestyle.
First, author makes an assumption that there are very few or no Salon's that provide premium services similar to that of Luxe Spa in Parksboro. The profitability of the Luxe Spa's business depends on the competition that is already present and the level of customer base Luxe Spa can acquire. Having information on the existing competition would further enhance the ability to evaluate profitability of Luxe Spa.
Given that average household income is higher than national average, it's highly likely that cost of land and other services required for setting up a Saloon could be high. This in turn would lead to longer break even for Luxe Spa. The assumption that cost of setting up branch in Parksboro would not be any higher than other branches, hasn't been evidenced in the argument.
Argument fails to provide the demographic split or the population size of Parksboro and assumes that Salon would have good number of customers. It's highly likey that Parksboro could be small community of affluent people in range of 500 to 2000. This could mean a low customer turn out, which may potentially lead to losses for Luxe Spa. If the argument had provided information on the customer base in Parksboro then it would have been possible to assess if Luxe Spa was in a position to make profit.
Author also assumes that using premium services in Salon is directly linked with the spending habbits displayed by the household. It is possible that Parksboro household prefer to buy premium personal care products but may not be equally keen on using premium services offered by Luxe Spa. Similarly, having Jacuzzi may not have any co-relation to using pricey Salon services. It could be possible that the houses are pre-built with Jacuzzi fittings.
In summary, the regional manager's memo doesn't provide enough information to strengthen his argument.
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