"Overtime, the costs of processing goes 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 5day service in 1970 to 20 cents for 1day service in 1984. The same principle applies to the processing of food. And Olympic Foods will soon celebrate its 25th birthday, we can expect that our long experience will enable us to minimize costs and maximize profits."
The author states that as days goes by the costs of processing of an organization decreases as the organization becomes more efficient by learning to do things in a better way. The author also states an invalid example comparing the processing costs of a color film with that of food processing. Furthermore, the author expects minimized costs and maximized profits is a result of long experience in the market. The author's statement is seriously flawed in the following ways.
Firstly, the comparison given by the author of the costs of processing food with costs of processing color film is totally invalid. In both issues, the criterion of processing is different from one another. Moreover, the author's evidence that in color film processing, the cost of a 3 by 5 inch print goes down from 50 cents for 5day service in 1970 to 20 cents for 1day service in 1984 is similar to the principles of food processing is not valid, as there is no mention about the facts related method, techniques, service or equipment that has been utilized in color film processing stating that it is similar to that of the principles of food processing. The author would have been successful in explaining his point if he had mentioned a similar example or evidence with regard to the processing of Olympic Foods.
Secondly, one cannot expect growth only by basing on a single factor i.e. Experience. The author expects that the Olympic Foods will soon see that its costs are being minimized and its profits are maximized in its coming 25th birthday. Only experience of a company in the market, never leads to growth of itself. There are several reasons which are to be kept in mind so as to expect a positive remark in future. The maximizing of profits and the minimizing of costs is only possible if the company has performed well in the past. The performance here means how the company has stood in various circumstances facing competitions with lack of resources or may be any other factor. If the author would have mentioned any facts about the Olympic company's performance, then it would have achieved success in explaining its point.
In conclusion, to increase the value of Olympic Foods, it is important that it should cite some relevant examples as well as facts and figures of its company showing that along with experience and further details, it is expecting maximized profits and minimized costs in the near future.
The author states that as days goes by the costs of processing of an organization decreases as the organization becomes more efficient by learning to do things in a better way. The author also states an invalid example comparing the processing costs of a color film with that of food processing. Furthermore, the author expects minimized costs and maximized profits is a result of long experience in the market. The author's statement is seriously flawed in the following ways.
Firstly, the comparison given by the author of the costs of processing food with costs of processing color film is totally invalid. In both issues, the criterion of processing is different from one another. Moreover, the author's evidence that in color film processing, the cost of a 3 by 5 inch print goes down from 50 cents for 5day service in 1970 to 20 cents for 1day service in 1984 is similar to the principles of food processing is not valid, as there is no mention about the facts related method, techniques, service or equipment that has been utilized in color film processing stating that it is similar to that of the principles of food processing. The author would have been successful in explaining his point if he had mentioned a similar example or evidence with regard to the processing of Olympic Foods.
Secondly, one cannot expect growth only by basing on a single factor i.e. Experience. The author expects that the Olympic Foods will soon see that its costs are being minimized and its profits are maximized in its coming 25th birthday. Only experience of a company in the market, never leads to growth of itself. There are several reasons which are to be kept in mind so as to expect a positive remark in future. The maximizing of profits and the minimizing of costs is only possible if the company has performed well in the past. The performance here means how the company has stood in various circumstances facing competitions with lack of resources or may be any other factor. If the author would have mentioned any facts about the Olympic company's performance, then it would have achieved success in explaining its point.
In conclusion, to increase the value of Olympic Foods, it is important that it should cite some relevant examples as well as facts and figures of its company showing that along with experience and further details, it is expecting maximized profits and minimized costs in the near future.
