Just over one month ago, during frosh week, a man named Michael Hallatt was invited to speak in front of our faculty. He filled us in on his unconventional business plan, which was quite simple: he would buy food from Trader Joe’s across the border and then sell it here in Canada for a slightly higher price. This contraband idea landed Michael in a large lawsuit with this multi million-dollar corporation. I was happy to read yesterday that he actually survived this David and Goliath style lawsuit, but at the same time I am a more or less confused about the entire situation. First of all, Michael’s business plan doesn’t seem to make sense. Instead of purchasing his products from a manufacturer at wholesale prices, he simply buys products for full price and then resells them for even more. My thought process goes like this: Michael knows that his target demographic consists mainly of people who are already familiar and fond of the brand Trader Joes. This means that a good portion of his costumers were once willing to drive themselves across the border in order to buy the same products for a cheaper price. I find it hard to believe that these people would consciously decide to pay a higher price for the same product when they were, at one point, contempt to buy it at a cheaper price before. One could argue that his customers are paying that extra price to make up for the costs of driving across the border, but that just turns into variable costs that Michael has to subtract from his revenue. Therefore, his customers are merely paying him money to drive instead of them.