My first attempt at a GMAT essay:
The following appeared as part of an annual report sent to stockholders by Olympic Foods, a processor of frozen
foods:
“Over time, the costs of processing go down because as organizations learn how to do things better, they
become more efficient. In color film processing, for example, the cost of a 3-by-5-inch print fell from 50 cents for
five-day service in 1970 to 20 cents for one-day service in 1984. The same principle applies to the processing of
food. And since Olympic Foods will soon celebrate its 25th birthday, we can expect that our
long experience will enable us to minimize costs and thus maximize profits.”
My response:-
The report states that any industry, with time, can maximize profits and minimize operational costs. This argument is fundamentally flawed because of the following reasons.
The report states that the costs and time involved in image processing decreased from 1970 to 1984. This could be due to numerous reasons like better availability of raw materials involved in image processing or perhaps, development of significantly better equipment over time.
The report also assumes that the principles which led to improvement in image processing can be applied to food processing without any strong evidence or logic. As stated in the above paragraph, the raw materials essential in food processing mostly include different kinds of oils and preservatives which may or may not be available at a discounted price so as to make the whole process more economical. Though we can argue that with better equipment and technology in food processing, we can decrease the operational costs and increase profit margins, the report fails to explain how to achieve these goals. The capital involved in up to date food processing technologies can be so expensive that it may not be worth the investment in the long run with its maintenance costs factored in.
Food processing is a very health-focused industry where the manufacturer cannot afford to let the eatables lose their nutritional value by any means. In comparison, both the raw materials and finished products in image processing don't lose their value under normal circumstances unlike the food items which may start to rot due to the slightest of negligence.
The report fails to mention any similarities between the two industries. Thus it fails to convince us as it is vaguely assuming that the same principles can be applied in both of them without any logic or substantial evidence.
The following appeared as part of an annual report sent to stockholders by Olympic Foods, a processor of frozen
foods:
“Over time, the costs of processing go down because as organizations learn how to do things better, they
become more efficient. In color film processing, for example, the cost of a 3-by-5-inch print fell from 50 cents for
five-day service in 1970 to 20 cents for one-day service in 1984. The same principle applies to the processing of
food. And since Olympic Foods will soon celebrate its 25th birthday, we can expect that our
long experience will enable us to minimize costs and thus maximize profits.”
My response:-
The report states that any industry, with time, can maximize profits and minimize operational costs. This argument is fundamentally flawed because of the following reasons.
The report states that the costs and time involved in image processing decreased from 1970 to 1984. This could be due to numerous reasons like better availability of raw materials involved in image processing or perhaps, development of significantly better equipment over time.
The report also assumes that the principles which led to improvement in image processing can be applied to food processing without any strong evidence or logic. As stated in the above paragraph, the raw materials essential in food processing mostly include different kinds of oils and preservatives which may or may not be available at a discounted price so as to make the whole process more economical. Though we can argue that with better equipment and technology in food processing, we can decrease the operational costs and increase profit margins, the report fails to explain how to achieve these goals. The capital involved in up to date food processing technologies can be so expensive that it may not be worth the investment in the long run with its maintenance costs factored in.
Food processing is a very health-focused industry where the manufacturer cannot afford to let the eatables lose their nutritional value by any means. In comparison, both the raw materials and finished products in image processing don't lose their value under normal circumstances unlike the food items which may start to rot due to the slightest of negligence.
The report fails to mention any similarities between the two industries. Thus it fails to convince us as it is vaguely assuming that the same principles can be applied in both of them without any logic or substantial evidence.
