ESSAY QUESTION:
The following memo was circulated by the management team of a retail company:
"We are very pleased to announce that the relocation of our inventory, which had been located in four different warehouses throughout the country, to a single new warehouse near Company headquarters in Boston. This consolidated location will cut the company's expenses for warehouse rent in half. As a result we expect our monthly profitability to go up by this amount."
Discuss how well reasoned you find this argument. Point out flaws in the argument's logic and analyze the argument's underlying assumptions. In addition, evaluate how supporting evidence is used and what evidence might counter the argument's conclusion. You may also discuss what additional evidence could be used to strengthen the argument or what changes would make the argument more logically sound.
YOUR RESPONSE:
It is expected that the relocation of the company inventory from four different warehouses throughout the country to single new warehouse in Boston will increase the monthly profitability of the company because the company will save on the warehouse rent . The argument is flawed for reasons as below.
The argument assumes that the four different warehouses in different location were actually a disadvantage to the company and were increasing the company's expenses for warehouse rent . What if the the four different warehouses were actually an advantage for the company . The four different warehouses in different location can actually decrease the transportation cost , time and resource effort needed to ship the products from the inventory to the market . The relocation of the inventory to single warehouse can lead to added expense of the transportation cost for the company. The argument can be strengthened by substantiating the claim that the holding the inventory in four different location was an added expense to the company without any benefit whatsoever and centralizing the inventory will decrease the added expense without any other loss to the company.
The argument assumes that the single warehouse will be able to accommodate all the inventory which is stored in four different warehouse . If the size of the single warehouse is not able to accommodate all the inventory , then some of the inventory might be harmed leading to loss for the company . The argument can be strengthened by providing data that the single inventory size in Boston can accommodate all the inventories in the four location combined .
The argument assumes that the decrease in the company's expenses for warehouse rent will lead to increase in monthly profit by that amount . The profit of a company depends on many factors . The price of the raw material or the cost of production can increase which many prevent the monthly profit to increase . The argument also disregards the cost of transporting all the inventory from different locations to Boston . The cost of this transportation can be so huge that it will prevent any profitability in the company's expenses . The argument can be strengthened by giving some statistics of the other company expenses and providing some data that the other costs are likely to remain the same.
Thus the argument is flawed for the above reasons and can be strengthened by providing additional insights into the working of the company.
The following memo was circulated by the management team of a retail company:
"We are very pleased to announce that the relocation of our inventory, which had been located in four different warehouses throughout the country, to a single new warehouse near Company headquarters in Boston. This consolidated location will cut the company's expenses for warehouse rent in half. As a result we expect our monthly profitability to go up by this amount."
Discuss how well reasoned you find this argument. Point out flaws in the argument's logic and analyze the argument's underlying assumptions. In addition, evaluate how supporting evidence is used and what evidence might counter the argument's conclusion. You may also discuss what additional evidence could be used to strengthen the argument or what changes would make the argument more logically sound.
YOUR RESPONSE:
It is expected that the relocation of the company inventory from four different warehouses throughout the country to single new warehouse in Boston will increase the monthly profitability of the company because the company will save on the warehouse rent . The argument is flawed for reasons as below.
The argument assumes that the four different warehouses in different location were actually a disadvantage to the company and were increasing the company's expenses for warehouse rent . What if the the four different warehouses were actually an advantage for the company . The four different warehouses in different location can actually decrease the transportation cost , time and resource effort needed to ship the products from the inventory to the market . The relocation of the inventory to single warehouse can lead to added expense of the transportation cost for the company. The argument can be strengthened by substantiating the claim that the holding the inventory in four different location was an added expense to the company without any benefit whatsoever and centralizing the inventory will decrease the added expense without any other loss to the company.
The argument assumes that the single warehouse will be able to accommodate all the inventory which is stored in four different warehouse . If the size of the single warehouse is not able to accommodate all the inventory , then some of the inventory might be harmed leading to loss for the company . The argument can be strengthened by providing data that the single inventory size in Boston can accommodate all the inventories in the four location combined .
The argument assumes that the decrease in the company's expenses for warehouse rent will lead to increase in monthly profit by that amount . The profit of a company depends on many factors . The price of the raw material or the cost of production can increase which many prevent the monthly profit to increase . The argument also disregards the cost of transporting all the inventory from different locations to Boston . The cost of this transportation can be so huge that it will prevent any profitability in the company's expenses . The argument can be strengthened by giving some statistics of the other company expenses and providing some data that the other costs are likely to remain the same.
Thus the argument is flawed for the above reasons and can be strengthened by providing additional insights into the working of the company.
