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business - AQA
methods of production
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Cards (12)
To maximise
profit
,
businesses
need to operate so that they produce goods and services to meet a customers’
needs
and
wants.
Flow production
An assembly line produces
standardised
products.
Job production
Items are made
individually.
Flow Production
In flow production, an
assembly
line is used to build identical and
standardised
products.
Assembly line
An assembly line is a series of
workers
and/or machines that each work on a
specific
part of the product.
Capital intensive
Flow production is usually more
capital-intensive
, meaning that there is more
machinery
and less
labour
used in production.
Mass market and low production cost
Flow production is best used in an industry that needs a
low
cost
of production and provides for a
large
customer base.
Kaizen
The Japanese term kaizen means
continuous
improvement.
The process focuses on workers continuously making small
improvements
for overall progress and
productivity
gains in a firm.
Cell production
Workers are grouped into
multi-skilled
teams within
cells.
Different
teams are assigned to
different
aspects of the production process.
A cell passes on
completed products
to the next cell in the
production
process.
Lean Production
Lean production techniques are geared towards
reducing waste
during production.
Just in time (JIT) is a method for managing
stock
that aims to keep stock levels very
low
at all times.
Advantages of JIT
JIT can reduce
costs
because a business does not have to pay for
storage
space for the stock and the business is likely to have less
unsold
stock.
Storage also adds other costs, for example
damage
to stock, stock
insurance
and security to protect the stock.
Disadvantages of JIT
JIT usually needs more
frequent deliveries.
More deliveries usually means higher
transport
and
logistic
costs.
High chance
business
will not be able to meet
demand spikes