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bell the gmat cat
- Newbie | Next Rank: 10 Posts
- Posts: 2
- Joined: Tue Aug 09, 2011 7:35 am
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:
The above argument is full of deficiencies and open to a lot of questions as the author has based his conclusion on dubious assumptions. Neither the premises are convincing nor the conclusion is compelling.
Firstly, the argument avers that the monthly profitability of the retail company will go up due to the centralized location of its warehouse. This is a flawed claim because the author has overlooked other factors which might run counter to the conclusion. The rents of the warehouse might get reduced but this cost reduction might be offset by the increased transportation costs that the company has to bear now. Due to consolidated location, the company will incur huge transportation costs for supplying material to the locations far way from Boston. If this alternative explanation becomes true, then the profits of the company might not be affected or might even decrease.
Secondly, the argument provides no evidence for the claim that the centralized inventory location will cut the company's expenses for warehouse rent in half. It is plausible that the four warehouses were located in the outskirts of the country where property prices and rent are generally low. In this case, the saving in rent might not be greater than the rent paid for a single warehouse as this warehouse is located amid the city.
Lastly, another possibility that may weaken the conclusion is that the profits will not increase if costs incurred on the maintenance of a single location outweigh the reduction in rents. A centralized location may make it difficult to manage the inventory and hence goods might get spoiled, damaged etc, leading to a loss for the company.
In summary, in the absence of substantiated evidence and statistical data, the argument remains fallacious. Had the author taken the above factors in view, the conclusion would have been rendered incontrovertible. The information provided , however, fails to present a holistic picture of the superfluous claims made by the author.
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:
The above argument is full of deficiencies and open to a lot of questions as the author has based his conclusion on dubious assumptions. Neither the premises are convincing nor the conclusion is compelling.
Firstly, the argument avers that the monthly profitability of the retail company will go up due to the centralized location of its warehouse. This is a flawed claim because the author has overlooked other factors which might run counter to the conclusion. The rents of the warehouse might get reduced but this cost reduction might be offset by the increased transportation costs that the company has to bear now. Due to consolidated location, the company will incur huge transportation costs for supplying material to the locations far way from Boston. If this alternative explanation becomes true, then the profits of the company might not be affected or might even decrease.
Secondly, the argument provides no evidence for the claim that the centralized inventory location will cut the company's expenses for warehouse rent in half. It is plausible that the four warehouses were located in the outskirts of the country where property prices and rent are generally low. In this case, the saving in rent might not be greater than the rent paid for a single warehouse as this warehouse is located amid the city.
Lastly, another possibility that may weaken the conclusion is that the profits will not increase if costs incurred on the maintenance of a single location outweigh the reduction in rents. A centralized location may make it difficult to manage the inventory and hence goods might get spoiled, damaged etc, leading to a loss for the company.
In summary, in the absence of substantiated evidence and statistical data, the argument remains fallacious. Had the author taken the above factors in view, the conclusion would have been rendered incontrovertible. The information provided , however, fails to present a holistic picture of the superfluous claims made by the author.
