There must be a large number of varriables, most of them subject to
opinion. My guess is several people have produced detailed
mathematical annalysis that can be applied in any situation, which
typically miss the mark in hind sight.
Let's say you press 12 inch vinyl phonograph records in Jacksonville,
Florida, USA. You have 22 full time and 28 part time employees, most
of whom can do several of the required tasks with adequite skill. This
is because you have already shrunk the operation several times, and
successfully disposed of most of yout marginal employees. You are in
the depth of the January slump with a product for which world wide
demand is shrinking rapidly. You consider ending production completely
until August 12 th this year, at which time you hope to resume with
about half your present staff. (you will keep about 4 sales and
clerical people to process communications with people you hope will
resume being coustomers in about 8 months. The alternative is to
accept $4000 from a competitor to buy you out. This looks unatractive
as your equipment has $4 million dollars in remaining depretiation and
there are perhaps a million additional dollars in assets that probably
can not be given away unless you pay the shipping cost. If you turn
down the $4000 offer, you may not have sufficent orders and probable
orders on August 12 to justify reopening the production even if you
are able to rehire half of your present employees )doubtful) The
nearest labor pool of workers trained in vinyl record production is
almost 1000 miles from Jacksonville. You are of course considering
several areas that you might diversify into, at least until August 12,
but so far they all look like long shots. I think you get the idea
many varriables, unique to your staff, equipment, customers and
projections for the future of the products. Neil |
