What Is the Right Way to Decide Where to Do Business?
When a company is looking for ways to improve profitability and thereby increase returns on investment to its stockholders, the company will often seek new places to do business, including countries where it is not currently doing business. Assume that the company has decided to start business operations in one additional country but has not decided which country. The company is deciding between Country A and Country F. Setting up operations will cost about the same in either country. Country A has a very low risk of corruption; its CPI is 8.5. On the other hand, Country F has a very high risk of corruption; its CPI is 1.4. Country A is a smaller market than Country F. Projected sales revenue in Country A is $1 billion. Projected sales revenue in Country F is $2 billion.
Point Team
A business has an obligation to its owners to make a profit and thereby provide the owners with a return on their investment. Because Country F offers the potential of twice the revenues of Country A, the company should set up operations in Country F.
Counterpoint
While Country F offers the possibility of twice as much revenue as Country A, the risk of corruption in Country F is several times higher. If the company establishes business in Country F and later becomes involved in corruption, the company could lose all its extra profits settling court cases and paying fines. The safer route would be to establish business in Country A, where the risks of corruption are much lower.
Question: How to defend point team? In what ways point team can argue from? Since I am a safe player, I do not support the idea of the point team but my teacher set me up on the point side,