Exercise 5. Translate the text “Management and cost saving” and describe interrelations between management and cost saving.

The manager’s evaluation of the extent of the market should broaden as the planning horizon increases. Managers should adjust the market definition to reflect those competitors they expect to challenge. In the short run, say within the coming year, the company’s immediate competitors are more easily identified. In the medium term, say one to three years, producers of substitute products and producers introducing low cost production methods enter into the mix. In the longer term, say over three years, innovative competitors and entrepreneurial start-ups will increasingly affect profitability.

The computerized plant information system made it possible to improve information on production process, to achieve considerable savings and to improve profitability at a plant. Below are important factors which contributed to desirable savings and better profitability.

Recorded work effort. Emphasis is now placed on the tracking of labour time because the cost of labour, other than possibly the cost of materials, is usually the most expensive element of cost. In addition to reporting time in and out of the plant, each employee's time is also reported by the job when it is necessary to properly cost the utilization of the labour effort. A benefit of the rapid accumulation of the labour hours or labour cost assigned to or used on a project is the comparison of expected expenditures against actual performance. Since this reporting is done currently, corrective action can be taken by management.

Reduced absenteeism. A result of the same recording of time is the creation of a realistic absentee report which should be given routinely to each manager in order to keep him alert to developing problems of absenteeism. The reporting effort is always worthwhile, especially when considering that the time and absentee report come from the same data which is needed for calculating the payroll.

Optimized purchase ofmaterials. Better control of the inventories allows for more economical quantity purchased. This means not only buying in quantities that reduce the unit price, but just as important, it permits buying the correct amount at the right time which permits lower handling, and storage costs.

Maximized production schedule. Production scheduling is a difficult job, even when good forecasts of demand are available, but it becomes even more difficult when unexpected customer demands or raw material stock-outs occur. This is why improved raw material inventory conditions have a distinct beneficial effect on production scheduling. A proper sequencing of grades and blends of products can be scheduled, which permits runs of a size not only to obtain the most production at least costs, but aids in having adequate inventory conditions to prevent consumer order stock-outs.

Reduced warehousing expenses. The cost of warehouse space can be calculated in square feet of floor space because unsatisfactory storage conditions may occur when the inventory exceeds estimates and available floor space.

Reduced accounting expenses. The computerized plant information system reduces the cost of accounting effort. While accounting is improved and the costs are declined, clerical effort is also reduced and the skilled accountants are able to devote more of their time to analyzing results and making recommendations to management.

Better quality control. Maintenance, safety, engineering design, testing and trouble shooting all are areas where the plant information system can aid in saving money spent on manpower efforts. As the finished goods are better tested and maintained, their quality is liable to improve.

Improved customer service. Improved inventory stocks, improved production scheduling and improved quality control assist in improving the level of customer service. When these are further assisted by the study of up-to-date customer order status and order requirements, a significant change in customer service level results.

Exercise 6. Translate into Russian the following words and word combinations:

To achieve considerable savings, to improve profitability, recorded work effect, tracking of labour time, utilization of the labour effort, assigned to, expected expenditures, actual performance, to take corrective action, reduced absenteeism, absentee report, to keep smb. alert to, to be worthwhile, to calculate the payroll, optimized purchase, lower handling and storage costs, maximized production schedule, stock-outs, a sequencing of grades and blends of products, adequate inventory conditions, warehousing expenses, floor space, unsatisfactory storage conditions, to exceed estimates, the cost of accounting effort, to make recommendations to management, maintenance, engineering design, trouble shooting, manpower efforts, to be liable to, inventory stock.

 

Exercise 7. Fill in the gaps with the right words:

a) promotion, directors, appointed, management, pay rise, post/position, board of, managers.

The people who run a company are known as ___. It is made up of individual ___ who are ___ to their posts (positions) by the ___ directors, which is the collective name for ___. If manager is appointed to a higher ___ in the firm it means he is given a ___ and will receive a ___.

b) shift system, overtime rate, salary, bonus, wages, recruitment, skilled, skills, shop floor, assembly plant, bonus payment, shift, rate, overtime, labour time, apply, to recruit, equipment, to operate, labour force, trained.

The men who actually produce goods at the factory (or ___) are known as workers (or ___). The men working on the ___ in the factory ___ the machinery (or equipment). Workers who have specialized ___ or who are ___ to operate sophisticated ___ are called ___ workers. To increased its labour force, a company tries to ___ new workers who might undertake a ___ program and hires workers who ___ for jobs. The workers are paid ___ for working a certain number of hours each week ___. Workers are paid weekly, a manager's ___ is normally paid monthly. If a worker works more than his required number of hours, he works ___ and is paid at ___ which is higher than the normal ___ of pay. Some factories operate a ___. The men work 8-hour ___ throughout the 24 hours for the assembly plant operates all the time. Sometimes workers are given a ___ for increased productivity or a ___ at Christmas.

c) pension, to retire, notice, retirement, for good, notice.

If someone wants to leave his job he must give ___. Workers normally give at least a week's notice, managers work one or three months' ___. If someone leaves work ___ because he is old, he ___ (or goes into ___) and normally is given a ___ which is a regular payment for him to live on in his retirement.

Exercise 8. Translate into English:

Влияние планирования и контроля на производительность и качество обеспечивается благодаря ясности планов и путей их достижения, наличию обратной связи, поощрениям (positive reinforcement) и наказаниям, хотя вмешательство менеджера в процесс работы нежелателен; участию работников в достижении цели; управлению методом оценки эффективности (management by objectives), т.е. постановка среднесрочных целей и периодическая оценка шагов по их достижению

Последовательность управления трансформации затрат в выпуск (managing the input-transformation-output sequence) – процесс планирования, организации, руководства и контроля, направленный на трансформацию затрат в выпуск, где затраты образованы натуральными ресурсами, трудовыми ресурсами, информацией, технологией, полуфабрикатами и т.д., а также капиталом. Трансформация может принимать формы последовательного (continuous), параллельного (batch), аналитического (analytic) и синтетического (synthetic) процессов.

Выпуск образован разнообразием товаров и услуг. Последовательный процесс: факторы производства образуют систему, результатом которой является товар. Параллельный процесс: факторы производства связываются отдельно для каждой единицы выпуска (строительство дома). При аналитическом процессе выпуск производится отделением части от целого (рафинирование нефти). В синтетическом процессе части и материалы связываются в единое целое в виде готовой продукции.

Part 4. Marketing concept.

Read and translate the text:

Market is a place where buyers and sellers meet and where "goods" and services can be bought and sold. Firms in both sectors of the economy will have their own markets: markets for health services and health-food products, public and private transport; and industrial cleaning and domestic window-cleaning, etc. Capital market, much of which is centered on the working of the Stock Exchange, brings together sellers and buyers in this case, the institutions, such as insurance companies, which supply funds and the companies (together with central and local government) which want borrow funds. There is a labour market - firms demand work and employees supply it.

The market to a firm consists of its actual or potential customers who can afford to buy the firm's goods and services. It is the role of the firm's Marketing Department to examine the market and to provide information on it. The Marketing Department will be interested in the needs of the firm's customers, the firm can then design its goods and services to satisfy these needs. By doing this, the firm should be successful, i.e. it will make profits and survive.

Market and segmentation. The market for a product can sometimes be broken down into different segments. For example, the car market in the UK consists of a number of segments: family car (medium or large size, plenty of luggage space) company car (easy to service, easy to sell after replacement) second car (small car, economical to run, inexpensive to buy), luxury car (Rolls Royce and the like), etc. Each market segment will have its own unique requirements and therefore will need a different “mix” of marketing resources. Consumers in these markets and segments will differ in the following ways: age, occupation, and income.

Marketing is one of the most varied activities in modern firms. In the last 20 years, people in business have realized that it is not good enough simply to produce a product or service and then hope that it will sell. Marketing involves all the business activities that create and distribute products (goods, services, or ideas) to consumers. Marketing is based on the exchange process. It can be carried out on a micro or macro scale, and is done by non-profit as well as by profit-marking organization. On the whole, marketing tries to satisfy consumers by creating utility. It makes sure that the product is in the most useful form, that it is in the place where the consumer can buy it and when the consumer is satisfied by owing it. Marketing creates these utilities by performing several functions: buying, selling, transportation and storage, standardizing and grading, financing, risk taking and gathering information.

Since the marketing concept is based on satisfying the wants and needs of consumers, companies must find out what and why consumers want to buy. The company must determine if there is a market or demand for its products. The company must also determine which segment of the population is likely to buy the products, so that it can aim its advertising, pricing and other activities at this target market.

Every marketing strategy, or marketing mix, combines four elements (four “Ps”): product, price, promotion and place (or physical distribution).

Product. The first "P" of marketing strategy is product. For each product the marketer must answer these questions: how should the product be designed or styled? What features or options should it provide? How should it be branded, packaged and labeled? What kind of guarantee or warranty should be offered? What after-sale services should be offered? Together, these things make up the product itself.

In problems of market selection and product planning one of the key concepts is that of the Product Life Cycle. These products pass through various stages between life and death (introduction-growth-maturity-decline) is hard to deny. It is accepted that a company should have a mix of products with representation in each of these stages. Companies can make far more effective marketing decisions if they take time to find out where each of their products stands in its life cycle.

Price. The second "P" is price. The product should be priced so that the company will make a profit but the price cannot be much higher than that of competing products. The marketer will have to decide what price level and specific price should be adopted. There are other questions, too: should price lists be useful? Should there be one price or more than one? Matters like credit terms and discounts must also be considered. And so must the purchasing power of the target market.

Price decisions. Price is one of the elements in the marketing mix. The price that a firm decides to set for its product will depend on both internal factors, i.e. the costs of production, and on the external factors, for example the prices of competing products on the market. The firm will add a profit mark-up onto its unit costs of production. If unit costs are 1 pound, a mark-up of 50 percent would give the firm a selling price of 1.50 pounds. It is called cost-plus pricing. It has its limitations since it is not easy to work out accurately the unit costs of production in advance; it also ignores the prices of competitors' products. The firm's management can use different price strategies for their products. These strategies can be "high-price" or "low-price".

High-price strategies. With a skimming strategy a firm launches a new and unique product and decides to charge a high price to skim the market. Some people will buy the new product at this high price, because of its "status symbol" appeal. As the status appeal dies down, the firm reduces the price so that more are sold. A maximizing strategy may be used: where there is great demand for a product or service which has a short life-cycle, the manufacturer will try to maximize profits by changing very high prices.

Low-price strategies. Using a penetration policy, a low price is set to enable the firm to capture a large market share. Prices can be increased later, to earn profits. A capturing strategy can be used if a company is making a range of products which are linked in some way. If, for example, a company is producing items of equipment and also the software used by that equipment, it may sell the equipment at low prices and then charge high prices for the software. Other strategies: odd (psychological) pricing (1.99 pounds), discrimination pricing (transport fare), marketing pricing (the item is priced the current market price, to avoid price wars).

Promotion. The third "P" is promotion. There are four types of promotion: advertising, personal selling, publicity and sales promotion. To create the best promotional mix for a product, many decisions must be made: what are the goals of the marketing comparing? What types of promotions should be used? How should they be meshed? Which media should be used? When should the product be promoted? These decisions and many more must be made for each product or group of products. A supplier of some light industrial equipment felt that the decline in the sales of his major product was due to the fact it was not receiving the sales support it deserved. In order to give extra sales support to this problem case a special advertising was run.

Place. The forth "P" is place or physical distribution. This has to do with how a product gets from the producer to the consumer. More decisions must be made, for example: how should a company get its products to consumer? How should conflicts among manufacturers, wholesalers and retailers be settled? How should warehousing, transportation and inventories be managed?

Market research will provide the Marketing Department for a firm with information about the elements of the marketing mix. The research will be factors such as the market itself, the likely demand for the product, the variety of models that the customers appear to want, the best price to charge and how best to advertise and distribute the product. There are two methods of market research: desk research (uses existing sources of information) and field research (involves obtaining new information about the market by going "into the field" and asking people).

Desk research. A company planning to use desk research may use its own sales statistics to identify trends or customer requests for changes in existing products or requests for new models. It can also investigate competitors' products already on the market. Finally the company may use government and other sources of statistics to assess trends that are taking place.

Field research. There are various methods of field research available to a firm. Each method involves using one or more of the following investigation techniques: questionnaires, test marketing and consumer panels. Questionnaires are designed for the task and completed by holding interviews with potential consumers (face-to-face, by the telephone, through the post). Test marketing is when a new product is marketed in one area of the country and the reaction of it is studied. Consumer panels are where selected people are given the product and asked to comment in detail on it.

Manufacturing. The heart of most businesses is the manufacture of their products. Such companies will need to state what their plants are for manufacturing – how the capacity will be increased, how machinery will be kept up-to-date, how new technology will be introduced, etc.

Research and development (R&D). Most companies need to develop their products and their services over time if they wish to keep up with the markets and, if possible, more ahead of their competitors. Whether the company supplies goods or services it will need to research new ideas and then to develop those ideas to the point at which they can be marketed. R&D is expensive, but is absolutely vital. Consumers require the very best in design, convenience and appearance and any company that does not carry out R&D will very soon find itself out of business.

 

Vocabulary:

scale – size or level in relation to other things or to what is usual

to determine – to form a firm intention or decision; to fix or find out exactly by making calculations, collecting information, etc.

to aim (at) – to direct one's effort towards doing or obtaining smth.; to intend (to)

to design – to plan or develop for a certain purpose or use

to adopt – to approve formally, to accept

option – smth. that is offered as well as standard equipment or number of actions, courses that may be chosen or possible

promotion– activity intended to help the development or success of smth.

to mesh – to fit together suitably (or qualities, ideas)

 

Exercise 1. Suggest the Russian equivalents for:

Non-profit and profit-making organizations, to create utility, storage, to take a risk, a segment of population, target market, marketing strategy, after-sale services, to make up a product, competing products, price list, purchasing power, to promote a product, wholesalers, retailers, to settle a conflict, to maximize a profit, up-to-date technologies, to keep up with the market, segmentation, desk research, field research, skimming strategy, capturing strategy, penetration policy, to figure out a price, to examine the market, to increase return on the investment, to identify physical terms, pricing techniques.

 

Exercise 2. Find the English equivalent:

Выполняться по микро- и макромасштабу, выполнять функции, сортировка по группам и стандартизация, концепция маркетинга, маркетинговый комплекс, определить товарный знак, маркировать, упаковывать, условия кредитования, рекламирование, индивидуальная продажа, скидки, финансовый рынок, рынок труда, стимулирование продаж, общественное мнение о компании и её продукте, складирование, транспортировка, товарно-материальные запасы, гарантия, объём производства, проектно-конструкторская работа.

 

Exercise 3. Use the right preposition:

Most products are branded. Branding is a way ___ identifying the product. It also provides legal protection and an image ___ which a marketing campaign can be based. Since the brand is so important, great care is taken ___ branding products and protecting trademarks.

Branding is a way ___ identifying a product or its producer. It is important ___ three reasons: 1. it identifies ___ the product ___its physical terms; 2.it provides ___ legal protection ___ patent and trademark laws; 3. it creates ___ a product image ___ which a marketing campaign can be based.

Branding is important ___ the consumer, too. It helps the consumer ___ make choices and provides some protection ___ case the item is defective. Branding is crucial ___shipping, storage, and inventory control. ___the producer, branding is a means ___ sorting, grading, and labeling. A brand is a name, symbol, design, or anything else used ___identify a product. The brand name is the part ___ the brand that can be said ___ loud.

The brand mark is the part ___ a brand that people recognize but can't say ___loud. The trademark is the part ___ the brand that is legally protected ___ being used ___ another company. Often it is indicated ___ the symbol ®.

Exercise 4. Choose the correct form of the verb:

A marketer may (to try) (to enlarge) a market through product extension. The main ways of (to extend) a product are through design, packaging and labeling, and service.

Marketers have (to set) the price of a product several times: when it (to be) first put on the market, when demand (to change), when a competing product (to cost) less, and so forth. When (to set) prices the marketer must (to keep) in mind the company's pricing goals and the way the price will (to set). The most common pricing goals (to be) increased sales or market share, status quo pricing, increased return on investment, and maximizing profits. After the goals (to set), the marketer (to figure) out a price. Common pricing techniques (to be) cost-based pricing (including makeup pricing and target pricing), demand-based pricing, and competition-based pricing.