“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.”
The conclusion that Olympic Food’s 25th anniversary (a ‘long’ experience) means that people can now expect lower costs and higher profits is flawed.
It is flawed because of the bad analogy used in the evidence, the fact that the evidence does not specifically support lower costs because of company specific conditions and very vague terminology.
Firstly, the evidence compares two wholly different industries- colour film processing and food processing. The two industries are different, starting from the fact that food processing is a perishable good industry and the other is not. The manufacturing process is completely different for the industries, and as a result so will the costs, and any cost reduction that happens over a long period of time.
Secondly, the reason for the fall in costs from 1970 to 1984 is not specified, and could be due to a number of reasons as opposed to just because of the passing of time. It could be that there was an invention that helped drop costs on an industry wide basis. This does not support the claim that experience has helped improve efficiency and drop costs.
Thirdly, the evidence uses a lot of vague terms in the form of ‘over time’. How much time is required by an industry to do things better and become efficient at lowering costs? Is twenty five years enough?
The argument can be strengthened by picking a better analogy- perhaps a product that is a substitute for the ones produced by Oylmpia Foods. It can also be strengthened by talking about the specifics of how costs fell in the analogy industry, or by doing away with the analogy entirely and talking about how Olympia Foods plans to be a more cost efficient producer.
In conclusion, the three main flaws of the argument are improper and unrelated analogy usage, vague and misleading terminology and a generalization of the importance of ‘experience’ in cost efficiency. All of these flaws can be used to strengthen the argument and make it better.