Pj foods ratonalises european operations hundreds of managers to go

PJ Foods, the food and beverage giant, ended a troubled year’s trading with the news that around 400 managers from all departments of the company’s European operations will lose their jobs in a cost-cutting exercise designed to make PJ more competitive. Commented CEO Lance Gullik: “Of course we regret taking this step, but it is a part of a process of re-engineering the entire company. We are removing layers of management to get closer to our front-line workers and our customers. Some top-level executives, such as Chief Buyer Hans De Witt, will be picking up pay-offs worth $1m or more, but the majority of those to go will be middle-managers. They will pick up between $35.000 and $100.000.

SUPERSUB ANNOUNCE NEW PROFIT HIGH

The chain of franchised sandwich stores announced record profits at its shareholders meeting yesterday. There are now over 10.000 stores in the chain, with an average income per store of $1.2 m per year.

SuperSub’s receipts from franchise holders were $ 180m. The company announced the formation of its ‘SuperSub Millionaires’ Club’ for franchisees who have become millionaires through the franchising. It already has 100 members. However, closures were also higher last year. Two hundred SuperSub franchise holders resigned their franchises because income was too low.

MEMO From: Petra LaSalle To: All sales staff As you may have seen, another record year. We are now up to 10.000 stores in the chain, with an average income per store of $1.2 m per year: receipts from franchise holders were $ 180m. The new ‘SuperSub Millionaires’ Club’ already has 100 members. The only bad news is that 200 SuperSub franchise holders resigned their franchises because they weren’t getting enough income. Most of them were in suburban locations. We really need to concentrate on city centres: office staff taking lunch really are our core market. Keep up the good work, Petra La Salle

Supersub: clean; simple; healthy

SUPERSUB is an international franchised chain of stores selling takeaway sandwiches and salads. It has been in existence since 1980 and is a world leader in food retailing. The concept underlying its success is Clean, Simple, Healthy Food. The franchises are easy to operate: none of the food sold in a SuperSub store is cooked.

Training

New franchisees receive two week’s intensive training in our international headquarters in Columbus, Ohio (air fares and accomodation not included). The programme covers everything you need to know about owning and operating a SuperSub store, and includes visits to actual operations. There are advanced courses for existing franchisees, and the SuperSub monthly newsletter contains tips to help you maximise your income.

Support

Being a SupeSub franchisee means that you get professional advice on marketing, taxes, real estate, store design and recruitment and many more areas from our 25 Business Expertise Departments in Columbus. Call us any time – it’s a toll-free line.

Growth in SuperSub operations

SuperSub opens over 1.000 new stores a year. It has outlets in all 50 states and in most European countries. This brings many benefits to our franchisees, including:

• Low, low prices on equipment because of our bulk-buying power.

• Nationwide TV advertising

• Increased customer recognition of your business’s name

Capital requirements, income and other costs

How much capital you need will depend largely on where you open your store and whether you build or convert existing premises. Recently a franchisee converted a shop in central Paris and got into business for only $160.000. He is now turning over $1.8 m per year. More modest suburban locations can be set up for as little as $50.000.

Gross incomes from SuperSub stores vary from $350.000 to over $10 m. Net profits before tax are around 10-15% in most locations. When you set up your SuperSub store we will be available to help at any time. For this service we charge a one-off non refundable fee of $2.500-$5.000, depending on the size of the store. Once you are in operation, we charge 1.5% of your gross income for use of the SuperSub name and business methods. We audit your accounts once a year.

9000 units

6500 units

4000 units

2500 units

900 units

1989 1991 1993 1995 1997

ORIENTAIR

FILE 1

Glossary

Make sure that you know these words. Find their Russian equivalents.

hong - a foreign firm or a company in China

route - a way or course planned or taken to get from one place to another

fierce - violent, cruel

drop in the market share - declining, growing weaker, becoming less

fleet - group of aircraft belonging to a particular owner

turnover - total value of business done during a period of time

surplus - excess of income over expenditure

operating surplus - difference between the revenues of a business and related costs and expenses, excluding income and expenses from sources other than its regular activities and before income deductions

profit ( surplus) - difference between business income and expenses

gross profit - difference between the value of sales and the cost of goods

revenue - money received during a particular period of time

capacity - the amount a factory or process can produce in a certain time

factor (coefficient, index, rate, ratio) - value measured by its relation to some other amount

break-even - a situation where income from sales equals the expenses of production, so neither profit nor loss is made

direct ticket - point-to-point ticket (flight)

return ticket - round-trip ticket

single ticket - one-way ticket

stopover - flight with stops on the way

inward journey - homeward journey

outward journey - trip abroad

overall results - total results

poor results - bad results

healthy results - good results

to win one’s support - to gain one’s support

to match rivals - to be able to compete (to be equal)

to put forward a proposal - to make a proposal

customer survey - a work of colleting information about customers’ tastes and opinions in order to plan how to advertise or sell the product

time-scale - dates, schedule

to circulate - deliver

findings - facts often presented as a statistic

tight restraints - strict limits

to work round the clock (the clock round) - to work all day and all night

check-in facilities - means to record one’s departure, or arrival at the airport

check-in personnel - people recording one’s departure or arrival at the airport

catering - providing meals and drink

to extract (results) - to take out, to get

Θ Orientair is a Hong Kong based airline serving destinations in the Pacific Basin, Asia and Europe. It is an independent company and is wholly owned by Mackenzie Smyth, one of the great Hong Kong “Hongs”. While competition on all Asian routes is particularly fierce, Orientair is currently more concerned about a drop in its market share on European routes.

The following extract is from the Orientair’s Fact guide. Read the guide.

Registered Office: Kai Tak International Airport, Hong Kong Fleet: Boeing 747 300 ... (a); Boeing 747 200Bs – 4; Boeing 737 - 8; Airbus A300 ... (b); Boeing 747 Freighter – 1; Super Tristar ... (c) No. of employees: ... (d) Turnover ($m) 1360 Operating Surplus ($m) 72 Gross Profits ($m) 68 Volume of traffic carried: Revenue passenger km (m) 10 339 Cargo tonne km (m) 361 No. of passengers carried (000) 4 319 Tonnes of cargo carried (000) 73 Capacity: Available seat km (m) 15 430 Available tonne km (m) 2 035 Load factors: Passenger load factor (%) 66,5 Break-even passenger load factor (%) 60,4 Overall load factor (%) 63,4 Break-even overall load factor (%) 58,0 Operations: Punctuality (% within 15 minutes) 81 Regularity (%) 99,2 Yield: Revenue per passenger km (cents) 9,79 Revenue per cargo tonne km (cents) 85,17 All figures relate to the financial year last ended.

Θ Exercise 1. Listen to the recording, fill in the gaps in the Orientair Fact Guide and answer the questions:

1. What is the company’s business?

2. What type of company is Orientair?

3. What is the company’s position on the market?

4. What is the company’s financial situation (according to the figures from the guide)?

Θ Exercise 2. Study this timetable. A business traveller in London wishes to book a seat on an Orientair flight to Hong Kong. Listen to the conversation with travel clerk and correct the details on the form below.

EUROPE – HONG KONG
Class Day Flight No. Dep. LONDON Heathrow dep. PARIS Orly dep. AMSTERDAM dep. FRANKFURT dep. ZURICH dep. ROME arr. BAHRAIN dep. BAHRAIN arr. HONG KONG	PCY 1 4 6 OR 751 13 55 21 10 22 05 11*05	PCY 2 7 OR 755 12 00 14 30 08*55	PCY 1 4 6 OR 757 12 00 15 15 09*55	PCY 2 OR 200 12 00 20 45 21 45 10*30	PCY 5 6 OR 250 18 00 14*00	PCY 3 6 OR 251 10 30 13 15 20 45 21 55 10*55
Notes: P – First Class (sleeper seats) 1 – Monday 4 – Thursday 7 - Sunday C – Business Class 2 – Tuesday 5 – Friday * - Next day Y – Economy Class 3 – Wednesday 6 – Saturday NB No traffic rights Amsterdam – Frankfurt, Paris – Rome, London -Zurich

London – Hong Kong – London Friday 18th July 19 .. Flight No. OR 757 (outward) 18 00 Heathrow to Hong Kong Kai Tak 14 00 (next day) Point-to-point round trip Open-dated return Business Class (=Y)

Exercise 3. Expressions related to air travel.

Notice: single (ticket) = one way (ticket)

return (ticket) = round-trip (ticket)

direct (ticket) = point-to-point (flight)

Write the opposites to these expressions.

A flight with a stopover a direct (or point-to-point) flight.

1) A return ticket ...

2) A one-way ticket ...

3) The inward journey ...

4) Book it now ...

e) A dated ticket ...

Θ On July 26^th Stephen Lee, the Managing Director of Orientair, calls a management meeting to discuss the problems on the European routes. At the meeting are Marketing Director, Tony Chan, and Financial Director, Gary Marsh.

Read the dialogue

Lee: Well, I think we can agree that overall results for the second quarter are satisfactory. Chan: I agree, Stephen. However, I must draw the attention of the meeting to the poor results on our European routes. While traffic and sales in the Asian Division are healthy, results for the European Division give us cause for concern. Marsh: I’d like to add to that, Stephen. Our market share on the European routes has been declining at an average rate of 2% over the past three years. Lee: Yes, we can see that from the statistics presented here. And the consequences ... ? Marsh: This loss of customers to our competitors is leading to a low and unprofitable load factor. Our planes are flying at 61% of capacity on European routes. Lee: That’s only just above break-even point. It’s obvious we can’t allow this situation to continue. We have to look urgently at some ways of improving our market share and attracting more customers. Chan: We all know that we can only win customer support by improving the quality of our service. Marsh: Yes, there’s little we can do about improving our fleet of planes in the short-term. And in any case, Cathay Pacific and BA will always be able to match us there. Lee: Tony, can you put forward any proposals for improving our service? Chan: We’re currently looking at the results of a customer survey. Jimmy Mo, the Marketing Manager, is working on it now. Lee: What about the time-scale?

Now listen to this part of the conversation.

Θ Exercise 4. The meeting goes on to discuss time-scale. Listen to the recording and answer the questions.

1. What are the results for the second quarter?

2. What are consequences of market share declining?

3. What can be done to improve the situation?

4. What is Jimmy Mo working on?

5. When is the next meeting to take place?

6. When are Marketing Department’s recommendations and report to be completed?

7. When is Managing Director to receive a copy report and recommendations?

Exercise 5. Rewrite these phrases using expressions from the dialogue.

The total results.

overall

1. I must tell meeting that ...

______________________________________________________________

2. The results are good.

______________________________________________________________

3. Our planes are flying about 61% full.

______________________________________________________________

4. Can you make any proposals?

______________________________________________________________

5. There’s little we can do about that now.

______________________________________________________________

6. We can only gain customer support.

______________________________________________________________

7. Could you deliver the findings to all Board members?

______________________________________________________________

8. We are working within tight financial limits.

______________________________________________________________

9. I look forward to seeing your recommendations not later than by August the 7^th.

______________________________________________________________

Θ Exercise 6. Directly after the management meeting, Marketing Director, Tony Chan dictated a memo to his Marketing Manager. Listen to the recording and write down the memo.

On receiving his boss’s memo, Marketing Manager, Jimmy Mo, works round the clock to complete his report on the recent customer survey.

Read this extract from the report.

	Excellent	Good	Satisfactory	Poor	Unsatisfactory
Check-in facilities Check-in personnel Punctuality Cabin service Catering In-flight entertainment Seat comfort	2% 11% 0% 4% 3% 7% 6%	23% 32% 22% 19% 18% 24% 21%	47% 48% 25% 25% 23% 31% 29%	18% 7% 28% 22% 24% 20% 27%	10% 2% 25% 30% 32% 18% 17%

The survey was conducted during the week beginning 19^th June on all routes. The above results have been extracted for European routes. It is clear that catering is the one area where we seem to be poor and where improvements can be made, particularly for Business Class and Economy Class. A selection of quotations from passengers is given below.

“The breakfasts in Economy are totally inedible.”

“You expect something a little better than this in Business Class.”

“Tasteless food but what do you expect in an airplane?” (Economy Class)

“Excellent food with charming service.” (First Class)

“If you have to keep waking us up to eat, why don’t you make it worth it?” (Economy)

Θ Listen to two Orientair passengers discussing the survey. Complete the survey form for them.

Flight number: ___________________ Class: __________________ Orientair is constantly trying to improve its service. We hope you will find time during your flight to help us serve you better. Please, give your opinion on the following. Orientair thanks you for your co–operation. Please, give this leaflet to one of our cabin staff or post it in the envelope provided. Excellent Good Satisfactory Poor Unsatisfactory Check-in facilities Check-in personnel Punctuality Cabin service Catering In-flight entertainment Seat comfort

Answer the questions:

1. On what routes was the survey conducted?

2. What did it show?

3. What is the weakest area?

Revision of the file

Exercise 1. Translate into English

1. Orientair обслуживает авиалинии Тихоокеанского бассейна, Азии и Европы.

2. Конкуренция на азиатских маршрутах была особенно жесткой.

3. Руководство компании считало, что причинами сокращения доли рынка на европейских авиалиниях были, во-первых, устаревший парк самолетов, во-вторых, низкое качество обслуживания и питания.

4. Финансовый анализ показал снижение валовой прибыли и объёма перевозок: выручка от пассажирских перевозок уменьшилась на 10%, грузоперевозки снизились до 73 000 т.

5. Потеря пассажиров привела к снижению загруженности. Коэффициент загруженности стал низким и неприбыльным, то есть составил 61%, что было чуть выше коэффициента безубыточности.

6. В соответствии со сроками результаты опроса должны быть предоставлены в течение двух недель и разосланы всем членам совета директоров.

7. Компании приходилось работать в условиях жестких финансовых ограничений.

8. Учитывая жёсткие сроки, Джимми Мо пришлось работать круглые сутки, чтобы подготовить отчёт о проведенном недавно опросе.

9. Пассажиры, выезжающие за границу, предпочитают брать билеты туда и обратно с открытой датой вылета и остановками в пути.

10. Опрос указал на неудовлетворительное питание, так как большинство пассажиров считают пищу либо несъедобной, либо безвкусной.

11. Результаты опроса дают повод для беспокойства.

Exercise 2. Give Russian equivalents for the following words and use them in the sentences (short situations) of your own.

hong outward journey

fierce to match rivals

operating surplus time scale

single ticket work round the clock

return ticket check-in facilities

direct ticket check-in personnel

inward journey catering

Exercise 3. Ring Global Travel to book a seat on an international flight.

Exercise 4. Give the summary of the file.

FILE 2

Glossary

Make sure that you know these words. Find their Russian equivalents.

remedy to the problem – to put (make) right

to give an edge over smb – to make better, to give an advantage over smb.

subject to – depending on, on condition

range – a set of different objects of the same kind (assortment)

to extend – to make longer or greater

disturbing – making upset, worried

to put strain on smb – put in a state of tension; to force beyond acceptable limits

long-haul flight – long distance flight

opposite number – person in the same job elsewhere

implication – suggestion not expressed but understood

to bear up – to show courage or strength by continuing in spite of difficulties

incentive – encouragement to greater activity (stimulus)

feasibility study – a careful study of how a planned activity will work, how much it will cost, and what income it is likely to produce

fall-back position – a situation where an alternative can be used when there is a failure or lack of other means

to fall back – to abandon one’s position

Θ The final draft of the Marketing Department’s report is approved by Marketing Director, Tony Chan, on the 1^st August. It is then retyped, copied and circulated to members of the Board by the 3^rd August, as required.

Read this extract from the final section of the report.

CONCLUSIONS The annual loss of customers on our European routes of 2% on average over the past three years would, if continued over the next two years, render our European routes unprofitable. Our product is, in effect, almost identical to the product offered by our main competitors, Cathay Pacific and BA No remedy to the problem of product improvement is available in the short term for the following reasons: * The only new wide-bodied aircraft on the market which would give Orientair an edge over its competitors – the Airbus A320 – could Not, even if the Board decided to purchase it, be delivered for at least two years. * Fare reductions, even with favourable purchase schemes such as APEX, would not make a significant impact because of IATA Conventions, which we are bound by. * Any variations in routes, including stopovers, are almost impossible to achieve, as they are under the increasingly strict control of the civil aviation authorities of the countries concerned. The results of the customer survey carried out by the Marketing Department showed that Orientair is weak in the service area, particularly for Business and Economy Classes. RECOMMENDATIONS Business Class catering to be upgraded to First Class standards. Economy Class breakfasts to be improved. Our contract with Bahraini Flightfood, due for renewal in October, to be negotiated subject to satisfactory improvement. Economy and Business Class lunches to be given a de luxe element, to include e.g. crepes suzettes and profiteroles, and fresh cream for dessert. The range of special meals to be extended. The following should be made available at 24 hours notice. Children Baby menus (fresh food rather than the current range of tinned and bottled food) Non-meat Religious Medical Vegetarian Muslim Diabetic Vegan Hindu Low cholesterol Kosher Low fat Salt free

Now listen to recorded extract from the report.

Exercise 1. Agree or disagree with the following statements. Discuss them.

1. The annual loss of customers will render European routes unprofitable

2. Orientair competes effectively.

3. Fare reductions and variations in routes may give Orientair an edge over its competitors.

4. The customer survey shows that Orientair is weak in the service area.

5. The main recommendations were given to update the fleet of planes.

Θ On 15^th August, the Board meets to discuss the customer survey report and to consider the proposal put forward by the Marketing Department.

Exercise 2. Read the text and fill in the gaps with the words given below.

survey considered in-flight unexpected costly outside unions alternative detail services majority circumstances findings

Present at the meeting: Stephen Lee Managing Director Tony Chan Marketing Director Gary Marsh Financial Director Alice Kwon Personnel Director Paul Tang Operations Director Lee: You have all got copies of the findings of the customer .... (a) and the report from Marketing, and I hope everyone has ... (b) them carefully. Now, let me hand over to you, Tony. Chan: Thank you, Stephen. The findings of the customer survey are very clear. It is obvious that a ... (c) of customers regard our cabin service and catering as either poor or unsatisfactory. Lee: These are disturbing findings, but not altogether ... (d). Tang: I must point out that many of the items in the questionnaire are ... (e) of our control. Punctuality, for example, depends on traffic volume, air traffic control system, and, of course, the weather. Chan: Yes, and although our customers are happy with our check-in personnel, there are continuing problems with check-in facilities. Marsh: Those facilities would prove ... (f) to improve. Lee: I’d like to come back to Tony’s earlier point. The major finding is that there is strong dissatisfaction with our ... (g) services. Let’s concentrate on that for a moment, shall we? We can come back to the ground services later. Kwon: It’s only fair to say our cabin staff do a good job in the ... (h). The question we have to answer is how we can improve in-flight services without putting too much strain on their goodwill. We must also avoid problems with the ... (i). Tang: We’re going to need extra cabin staff on our larger aircraft if we are to improve in-flight ... (j). Kwon: This is quite likely, though increased pay might be an attractive ... (k). Marsh: Erm-may I come in here Stephen? Lee: Yes, go ahead, Gary. Marsh: As Financial Director, I must remind the meeting that we are operating within strict financial restraints at this time. I’m sorry to keep repeating myself, but I think it is important we remember the realities of the situation. Lee: Don’t apologize, Gary. It’s a very good point. In any case, we don’t yet know whether these extra costs will be necessary. We’ve seen the proposals from Marketing. Let’s look at them in ... (l) first.

Now listen to the recorded conversation, and the exercise which follows it.

Exercise 3. Rewrite these examples using an expression from the meeting.

Let me ask Tony to speak now.

Let me hand over to Tony now

1. That’s not completely true.

_______________________________________________________________

2. I must tell you that the report was prepared at short notice.

_______________________________________________________________

3. Implementing these proposals could be costly.

________________________________________________________________

4. I’d like to return to that point later.

________________________________________________________________

e) What you say is quite possible, but what difference does it make?

________________________________________________________________

Exercise 4. Read these two accounts of the meeting. Which one do you think was included in the minutes of the meeting?

1. The Marketing Department’s report indicated that there is dissatisfaction with general areas of Orientair’s service. It was felt that several of the items mentioned, such as punctuality and check-in facilities, were either outside Orientair’s control or too expensive to improve in the short-term. Referring to the dissatisfaction with in-flight services, the Personnel Director felt that it was important to find solutions that did not put a strain on the cabin staff’s goodwill and did not create problems with the unions.

2. The major finding in the report by the Marketing Department was that there is strong dissatisfaction with Orientair’s in-flight services. It was felt that in order to improve these services, it would be necessary either to increase staffing ratios among cabin staff, or to increase pay. The financial Director, Gary Marsh, reminded the meeting that the company was operating within strict financial restraints at this time.

Θ Operations Director, Paul Tang, knows that if the Marketing Department’s proposals are adopted, it will be necessary to increase cabin staff on long-haul flights by a factor of two per flight. He also knows that the Board is unlikely to accept this increase in costs. He decides to seek support from his opposite number in Personnel.

Read the memo

MEMORANUM From: Paul Tang, Operations Director August 5th , 20 .. To: Alice Kwon, Personnel Director Re: IN-FLIGHT SERVICES Please refer to the minutes of the Board meeting held on 3 August and to the Marketing Department’s recommendations on the review of European services. The implications of recommendations 5.1, 5.2, 5.4 and 5.5 are considerable from an operations point of view. Having considered the requirements of such a wide-ranging improvement in services, particularly in relation to staffing, I feel that we should meet to discuss options and priorities. Please contact my secretary on extension 2173 to set up a meeting.

Θ Exercise 5. Listen to the recorded meeting between Alice Kwon and Paul Tang. Tick the correct statements (√).

a) The catering improvements will increase the workload of the cabin staff. ( )

b) The Board of Directors will agree to the new staff requirements. ( )

c) Alice Kwon suggests bonus payments for cabin staff, as a “fall-back position”. ( )

d) The Finance Department will be against Operations Director’s proposals. ( )

e) There won’t be any problems with staff and unions. ( )

Exercise 6. Reproduce the conversation.

Revision of the file

Exercise 1. Find the sentences in which the words from the glossary list are used, paraphrase them and translate.

Exercise 2. Give English equivalent for the following words and use them in the sentences (short situations) of your own.

Рассылать (письма, документацию); ежегодная потеря; способ решить проблему; основные конкуренты; делать неприбыльным; иметь преимущество; сокращение стоимости проезда; благоприятный; быть связанным (обязанным); изменения маршрутов; строгий контроль; гражданская авиация; заинтересованные страны; повысить качество; при условии; расширить ассортимент; факты, вызывающие беспокойство; дорогой (дорогостоящий); злоупотреблять расположением; профсоюз; дальние рейсы; коллега по должности; смысл (значение); анализ экономической целесообразности; отступление, уступка.

Exercise 3. Give the summary of the file.

FILE 3

Glossary

Make sure that you know these words. Find their Russian equivalents.

deadlock – disagreement that cannot be settled

money well spent – money successfully invested

tight financial margin – strict financial limits (tight financial restraints)

costing - calculating the costs of future activity or a product

costings – calculation of the costs

sobering – making or becoming serious or thoughtful

profit margin – difference between the price of a product or a service and the cost of producing it

to estimate – to calculate what the value, size, amount, etc. of smth is or will probably be

operating profit – profit relating to a company’s normal activities

to go round in circles – discuss the same ideas returning to the same arguments

angle of a problem – point of view

to strike – to come suddenly to the mind, astonish

long and expensive exercise – time and money consuming activity

to introduce note of reality - to draw attention to the real situation (state)

to go through the roof – to increase sharply

to launch – to cause an activity to begin ( to launch a product, project, club, magazine)

rule book – book containing rules or regulations

The question of the Marketing Department’s recommendations is item one on the agenda for the next Board meeting, which is to take place on the 28^th August. As the date approaches, the conflict between the Marketing and Finance departments intensifies.

Θ Discussions continue on the Marketing Department’s proposals for improving in-flight services. Financial Director, Gary Marsh, who is leading the fight against the proposals, meets Marketing Manager, Jimmy Mo, at a meeting. He asks to see him afterwards.

Read the dialogue

Marsh: Jimmy, thanks for meeting me. Are you very busy? Mo: No, that’s OK. I have to be somewhere in twenty minutes, but what can I do for you? Marsh: Can we have a quick chat about Marketing’s proposals for improving catering on European flights? Mo: Of course. I know your objections are pretty wide-ranging. Marsh: Well, to cut a long story short, my department’s view is that we can’t afford them. Have you considered the implications from a cost point of view? Remember, you’re talking about a major improvement for 38 flights per week. Mo: But we’re losing money on flights through low load factors. Marsh: I agree, but we still feel the cost of these improvements will prove to be too high. Mo: We believe it will prove to be money well spent. Marsh: Well, we’ll have to see about that. Have you thought about the extra staffing costs? The Board may decide against that. Mo: In our view the Board have no real choice. Marsh: You seem to forget that we’re operating on tight financial margins on these routes. Mo: Yes, I know that, but the way to widen margins is to attract more passengers. Marsh: That’s fine in theory, but we have to operate within the present budgets, which are strictly controlled. My department’s view is that we can’t afford your proposals. Mo: Well, we’ll need evidence of that. Marsh: The evidence is on every page of our accounts. Mo: Well, I’d like to see some figures. Marsh: Very well, you shall. I’ll send you detailed costings. I think you will find them sobering. Mo: Yes, well, it’ll be good to have a discussion based on facts for a change. Marsh: Exactly ...

Now listen to the recorded conversation.

Exercise 1. This is a summary of the arguments put forwards by Jimmy Mo.

The costs of the Marketing Department’s wide-ranging proposals will be high, but the major reason why profit margins on European routes are so tight is that there is a low load factor on these flights. Orientair, therefore, need to attract more passengers to improve on present performance. Money spent on attracting more passengers will, therefore, be money well spent.

Write a summary of Marsh’s arguments.

Θ Exercise 2. Gary Marsh sends the following costings to the Marketing Manager, as promised. When he receives them Jimmy Mo calls the Financial Director with some queries. Listen to the call and complete the memo.

MEMO From: G.D. Marsh, Financial Director To: J.K. Mo, Marketing Manager Re: COSTING OF CATERING IMPROVEMENTS (..............(a) In response to your request for a statement of costs, I am pleased to submit the following initial estimates ...........................................................................(b) $ million Staffing 2.09 ....................... ....................... Cost of upgrading menus 3.42 Marketing Additional to present budget 8.35 TOTAL 13.86 Please note that the above figures represent approximately 1% of our turnover, and that we will need to increase load factors on European routes by at least 1.5% to maintain the present level of operating profit.

Θ At the Board meeting on the 28^th August, discussion of the Marketing Department’s proposals ends in deadlock. The matter is referred to a sub-committee. Two days later, the sub-committee meets. Marketing Director, Tony Chan, is in the chair.

Read the text of the discussion.

Chan: Gary, could you clarify a point for us? Marsh: I’d be glad to. Chan: Is your objection to the cost of the proposals or to the proposals themselves? Marsh: In fact, it’s to both. Chan: As you know, my department’s proposals were based on careful research. Since you reject them, perhaps you would like to put forward some alternative ideas. Marsh: Well, Tony, that’s not really my job. I’m not a marketing expert, you know. Chan: I see ... Mo: We seem to be going round in circles again. Chan: Yes, can anyone suggest a new angle on the problem? Kwon: Yes, I have a suggestion I’d like to discuss. Chan: Go ahead. Kwon: Marketing isn’t my field, but it strikes me that the recent survey was based on the views of people who already use Orientair. The people we need to know more about are the ones who don’t use us. Marsh: Getting their views would be a long and expensive exercise. Kwon: I’m sure you’re right. But there is a category of potential customers, a very large category, which we are ignoring – and so are our competitors, as far as I know. Chan: And they are? Kwon: Asian families abroad. Marsh: Families? Kwon: Yes, there are thousands of Asian families living in Europe, North America and Australasia. Now, as we know, Asians have strong family ties. I’m sure that with a little encouragement, some of those families could be persuaded to travel by Orientair when they fly home to visit their relations. Chan: That’s a very interesting idea ...

Now listen to this part of the recorded discussion.

Θ Exercise 3. The Board goes on to discuss Alice Kwon’s idea. Listen to the recording and write down the names of the people who make the following statements.

We should offer group discounts to families. – Kwon

1. We could become the world’s first family airline. ...

2. Business customers are crucial to the success of any airline. ...

3. We could introduce a scheme to combine family and business bookings. ...

Exercise 4. Notice how Alice Kwon expresses what is on her mind:

“I was thinking we might offer group discounts ...”

You can use this structure, the past continuous, to express ideas that are not fully formed yet.

Notice also that in this situation, Alice Kwon cannot say:

“I was thinking of offering group discounts ...” because the decision is not hers alone. But in this situation she could use either form:

“I was thinking I might go home early.” or ...

“I was thinking of going home early.”

Now express the following as ideas that are not fully formed yet.

We might offer group discounts.