Английский язык для экономистов - Малюга Е.Н.
ISBN 5-469-00341-8
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Q: Isn't that a minority viewpoint these days?
A: I think that's true. The labor costs are definitely lower in China. But bear in mind our labor costs represent about 1.5 % of the revenues, so it's not a huge amount. Most of our product costs come in materials, and we do source most of the materials in China, where it's cheaper. But in actual finished production and labor involved, it's a very small part of our expenses.
Q: Still, if you could get even cheaper labor in China and shave labor costs even a little bit, wouldn't it be worth it?
A: There are a lot of counterarguments to using more labor in China. You're talking 1.5 % of our costs in Mexico. Move it to China, and you could cut it to 0.5 %. So you have a 1 % margin at stake. But there are countervailing factors.
You've got airfreight, which can be very pricey. Our plant is less than an hour away from major domestic shipping facilities in the San Diego area, and we can get everything out on a truck. The proximity also helps us keep cycle times low, so we can make sure we get our products on store shelves. The big stores want less and less of a window between when they give an order and when it appears on their shelves.
Then you've got product-defect rates. Even though we use a lot of the same production procedures when we produce in China, in Mexico we have a higher level of quality. We have employees who have worked for us for Unit 2. Production and Costs
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35 years, since we opened the plant. We have very low turnover. We have a very knowledgeable group that can produce exceptional quality. That's hard to replicate elsewhere.
Q: So a stable workforce close by allows you to maintain quality and cut costs more easily?
A: Yes. For example, we put a product-design team into our Mexico facility because when I have those people in the plant, cost reduction becomes very cool. One of the things they found was a way to use a plastic screw in one of our products instead of a metal screw — which actually turns out to be a better component because it is lighter weight. We actually saved some money on it.
Those are the kinds of things we want in place. If we were outsourcing to China, those things wouldn't have come back to us to the same degree. We wouldn't have the same level of innovation. In Mexico, we have a lot of people who really understand our products, in part because they have been working with on them for some time. Unit З
Urgent Problems of Marketing
A. Preliminary discussion
1. Do you know what marketing is?
2. How did marketing change in the 20th century?
3. What methods of merchandising do you know?
B, Pre-reading exercises
B.l. Skim the text and give its key idea.
B.2. Scan the text for the following information.
1. Why did marketing specialists — including middlemen and facilitators develop?
2. What are marketing functions and who performs them?
3. When were chain stores organized?
4. How have methods of merchandising been changed?
C Reading
C.l. Read the text and answer the questions.
1. What did the typical marketing setup use to 19th century?
2. Why is there a little need for exchange goods economy?
3. What supersedes market places in England?
4. What should marketing begin with?
Evolution of Modern Marketing
Marketing, in economics, is that part of the process of production and exchange that is concerned with the flow of goods and services from pro-
be in America in the in a subsistence-level Unit 3. Urgent Problems of Marketing
49
ducer to consumer. In popular usage it is defined as the distribution and sale of goods, distribution being understood in a broader sense than the technical economic one. Marketing includes the activities of all those engaged in the transfer of goods from producer to consumer — not only those who buy and sell directly, wholesale and retail, but also those who develop, warehouse, transport, insure, finance, or promote the product, or otherwise have a hand in the process of transfer. In a modern capitalist economy, where nearly all production is intended for a market, such activities are just as important as the manufacture of the goods. It is estimated in the United States that approximately 50 % of the retail price paid for a commodity is made up of the cost of marketing.
In a subsistence-level economy there is little need for exchange of goods because the division of labor is at a rudimentary level: most people produce the same or similar goods. Interregional exchange between disparate geographic areas depends on adequate means of transportation. Thus, before the development of caravan travel and navigation, the exchange of the products of one region for those of another was limited. The village market or fair, the itinerant merchant or peddler, and the shop where customers could have such goods as shoes and furniture made to order were features of marketing in rural Europe. The general store superseded the public market in England and was an institution of the American country town.
