Focus on speaking

Date: 2015-10-07; view: 505.

Discussion

1. Working in pairs, discuss the ways in which a medium-sized business might benefit from internal economies of scale.

2. Distinguish between internal and external economies of scale.

3.Distinguish between the size of a business and the scale of its activity.

4.Write the review of text 13.

Work with a partner or in a small group. Read and discuss the following situations.

1. Musaji Pressings Ltd are considering relocating their factory. The managing director consulted the senior management team for their views on the matter. The following is a summary of the reports they submitted.

· Production manager A greenfield site, preferably in the same area, would allow him to reorganize the shop floor and gain considerable economies. He did not want to move out of the immediate area because a number of his major suppliers were in the vicinity.

· Finance manager Sell up on the present site, so releasing the large amount of capital tied up in the land and buildings and lease a purpose-built unit fifty miles away.

· Marketing manager Agreed with the finance manager. The fifty mile move would take them closer to their major markets. It would also put them in the centre of the motorway network.

· Personnel manager Advocated staying in the same place and modernizing the building. He pointed out that local colleges met many of his training needs and courses might be difficult to set up in a new place. He was also concerned about his ability to recruit staff with the necessary skills. • The final decision was to move to a greenfield site in the area favoured by the finance manager.

a) Explain why there is a conflict of interests in the reports of the managers.

b) State and explain three problems the production manager might experience as a result of this move.

c) In view of the final decision, what do you think are the priorities of the business?

2. The text below was taken from an advertisement by the Merseyside Development Corporation. You are the company secretary of a medium-sized business producing consumer goods. The board of directors is interested in moving to Merseyside.

a) What information would you request your staff to discover in addition to that given in the advertisement?

b) Prepare a formal report for submission to the board outlining the advantages and disadvantages of relocating your plant in terms of:

· finance.

· the workforce

· communications

· the market.

· production.