Argument: “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.”
Essay:
In the argument presented the author assumes that with time the cost of processing of color films goes down as the organizations gain more experience in the field. It further states that the same principle applies to the processing of food. The author also tries to establish the assumption by giving the example how the cost of a certain film processing went down for an industry. Though the author has produced an evident in support of its argument but it is not enough to draw the conclusion presented in the argument. Therefore the conclusion is arbitrarily arrived upon without presenting any detailed and logical evidence.
First, the author assumes that the cost of processing goes down with the time, author doesn’t mention here if there was any research conducted by the industry for making the process cost effective. It further gives the example of how the cost went down for an industry from 50 cents for five days to 20 cents per day. The cost also if taken per day in first case will be 10 cents per day which is actually lower than it was in second case, therefore the example taken itself doesn’t support the statement made by the author. It also doesn’t take into the account the cost of raw material and technology. If the cost of the raw material and technology was decreased over the time then the cost of the processing of a relatively newer firm will also go down.
Further the author also tries to establish the connection between the food processing and processing of the color films. This is not supported by any type of example and any evidence is also not provided in this case. Both the industries are completely different from each other in terms of use of raw material and the output. Therefore it is possible that what works for one may or may not work for the other one. The cost of the product also depends on the profit percentage of the industries which is not taken into consideration while making the argument in case of food processing industries. We can take the example of milk products where the cost of milk, which is one of the raw materials, is increasing steadily due to which the cost of the milk products is also increasing steadily which should come down as per author's argument as many companies have grown older over the time and they have also gained significant experience.
Therefore it can be concluded that the argument of the author is not logical and it is also not supported by the evidence and we therefore can’t state that the cost of the processing go down as organizations grow older. In addition the same argument cannot be made for other industries which use altogether different raw materials and have different outputs which serve completely different types of demand.