GMAT Essays (AWA)

Hello community,

here is an essay I wrote and I would like your feedback. thanks in advance!


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.


In today's highly competitive economy, cost optimization has become an essential element of any company's strategy. In the statement above, the author believes that by centralizing all of his inventory into one warehouse, instead of spreading it into four throughout the country, his company will be able to decrease the rent expenditure in half, and therefore increase its profitability. Based on the statement's information we cannot concur with the author's conclusion.

First, the passage's argument jumps straight to a conclusion without providing any evidence. The author claims that by centralizing all the company's inventory activity into one location, the company will be able to save money but he does not include any number to back his statement up. By bringing all of the inventory in Boston, the warehouse in going to have to expand. How much additional rent will this enlarged space cost? Could it be more than the initial price of the four warehouse's rent?

Second, the author only focuses on the reduction in rent when discussing of the impact the new consolidated location will have on profits, disregarding all the other factors that can affect the company's bottom line in this scenario. Beyond the change in rent, this operation would most certainly affect the number of employees working in the warehouse, as well as the technological infrastructure necessary to operate such a larger scale operation. Most importantly, this move would greatly affect the time and cost of shipping around the country. When you have four warehouses dispersed around the country the distance to a client can never be so great that it will affect the time and the cost of shipping an item. But once all the company's inventory will be stored in Boston, the time and cost will greatly vary depending on if the client is located in New York or Seattle.

In addition, the author assumes that the relocation of his company's inventory will reduce the cost and automatically increase the profit, without having an effect on sales. Unfortunately, the quality of the service might be greatly affected by this relocation. If one of the initial argument of the company is that the it will deliver you any item in 24 hours, this service might not always be available depending on the location of the order. Businesses like Amazon rely heavily on their speed of service and therefore have warehouses all over the United States to better service their clients.

In summary, based on the above statement, we cannot agree with the author's reasoning as it pleagued with unverified assumptions and lacks key evidences necessary to support its argument.