You will hear part of a business negotiation between Mr. Mitchell and Madam Li.

Questions 23—30
    You will hear part of a business negotiation between Mr. Mitchell and Madam Li.
    For each question 23—30, mark one letter A, B or C for the correct answer.
    You will hear the recording twice.
(10 seconds pause)
F: Mr. Mitchell, when we last met, time did not permit us to discuss Sinochem’s exports of agrochemicals. Shall we review these now before we continue our discussions on dyestuffs and organic pigments?
M: I think that might be a good idea, Madam Li. Our time in Beijing is growing short and I do wish to take home as much information as I can.
F: This catalogue describes our agrochemicals’ exports, which include insecticides, fungicides, herbicides, and plant growth regulators, as well as fertilizers.
M: We would like to take home a number of copies of this catalogue, if we may, for review by our marketing division. In the meantime, however, it would appear that insecticides would be of primary interest.
F: Certainly, Mr. Mitchell. Just let me know how many copies you want and will have them delivered to your hotel before you leave.
M: Oh, half a dozen will be fine for now.
F: I will make sure this is done. May we now continue our discussions on dyestuffs and organic pigments?
M: Yes, I believe we have reached the stage where we should explore the feasibility of setting up an agency relationship with your company. I have reviewed our notes on our previous discussions and we have pretty well concluded that on this particular visit we should focus on your dyestuffs.
F: That will be fine. In other words, you would like to leave the possible importation of our inorganic and organic pigments for future consideration?
M: Yes, that is correct. We believe that Galaxy needs to do its homework on these commodities. We would like to complete some further market research studies before making any commitments to you in regard to this.
F: We appreciate your candour, Mr. Mitchell. Whenever you wish to reopen discussions concerning these commodities, we will look forward to hearing from Galaxy.
M: Now during our earlier discussions, you mentioned that your minimum quantity of shipping dyestuffs offshore is one container, holding between 10 and 14 metric tons.
F: That is correct, Mr. Mitchell.
M: What would be your agent’s commission on these minimum quantities?
F: We, too, have had some internal discussions on this matter and we can offer you an agent’ s commission of 2% of the selling price on all dyes.
M: Some of the dyes will be more readily marketable than others. For example, I can foresee that, with the right amount of promotional effort, we would be able to develop a significant market for your reactive dyes. Nevertheless, we would have to launch a fairly extensive, and no doubt costly, promotional program to introduce these dyes to the end users. There would be a very considerable first time advertising expenditure, followed by regular outlays for reinforcement advertising as these products become known and the end users begin to apply them.
F: As you know, the reactive dyes are considerably more expensive than the sulfur dyes. Therefore, any sales of these commodities would generate significant agency revenues.
M: During the initial stages, however, most of these commissions would be required to pay for the promotional expenses, which will be very substantial indeed. Have you considered the feasibility of assuming financial responsibility for at least a portion of the required advertising campaign? We would visualize some television and perhaps radio advertising, but primarily inserts into local daily newspapers and trade magazines.
F: We have not previously provided our agents with any, what you might call, promotional allowances. Advertising of our products is strictly the responsibility of the agent.
M: Under these circumstances, it would take a very long time before Galaxy would be able to recoup its up front expenditures.
F: Of course, if you were to import and market larger quantities from the outset, your commission would increase accordingly.
M: Which would, of course, undoubtedly increase your profits as well.
You now have 10 minutes to transfer your
answers to the answer sheet.
(10 seconds pause)