2.3

• Job production 


  One off, bespoke products. Made by highly specialist skilled workforce. Process is long. Can charge a premium price
• Batch production


  A larger volume of production than job, with some flexibility. Semi-skilled workforce and some levels of automation. Productivity reduced when switching batches
• Flow production


  High volume and low margins. Low-skilled workforce and highly automated. start-up cost expensive and usually involves expensive machinery
• Productivity


  Output per worker. High levels reduce cost per unit allowing firms to keep costs down and keep competitive prices. Higher productivity leads to higher profits
• Impact of Technology on Production

  Often expensive initially can speed up process and reduce costs

  Technology often means that products can be produced faster with fewer employees needed to reduce cost/unit

  Often require retraining of staff which increases cost

  Can ensure consistency and fewer mistakes and defects however often lower quality than handmade

  Less flexible suited to one job
• JIT 


  Keeps stock levels low. Reduces amount of warehouse space needed to keep raw materials therefore reduces cost and doesn't need as much insurance

  Requires high levels of coordination between business and suppliers. If there are delays or mistakes with the Deliveries, the firm may run out of stock using a JIT system

  Makes it difficult to meet unexpected surges in demand
• Logistics


  Process of getting goods and services from one part of the supply chain to another
• What should a business consider when choosing a supplier

  • Cost - the price of supplies and delivery charges
  • Quality
  • reliability of deliveries especially if USing JIT
  • Speed of Deliveries especially if using JIT
  • Availability of products
  • trust - can you rely on them?
• Effective procurement and logistics will

  • Improve the efficiency of a business; it will ensure that the business will have the supplies it needs at the right place and time
  • Reduce overall costs as money won't be wasted by being inefficient and they will have their supplies at the best price
  • Reduce unit costs allowing firms to reduce prices and be more competitive or enjoy higher profit margins
  • Improve customer satisfaction as high quality good value items will be with customers when they want them
  • Ensure a good reputation as they wont run out of stock or be late with deliveries
• Why is Quality Important

  • Allows for a premium price to be charged
  • Builds a strong brand Image
  • Provides a competitive advantage
  • Way of differentiating
  • Reduces cost (less waste)
• Quality control 


  Involves examining or testing products at the end of the production process
• Quality assurance


  Involves focusing on quality at every stage of the production process. Quality is everybody's responsibility and there should be 0 defects
• The sales process


  Product knowledge - Customers expect staff to be able to answer questions about the products

  Effective service - customers should be treated politely, served quickly and efficiently

  Customer engagement - communications with customers should be concise and accurate

  Respond to feedback - ignoring customers will likely lead to customer ignoring the business - businesses should make customers feel valued and listen to feedback and respond even more important on a public forum

  After-sales care - dealing with complaints, returns, and repairs.
• High levels of customer satisfaction lead to

  • customer loyalty and repeat purchase
  • Good reputation through word of mouth
  • positive PR which is free publicity
  • Increase sales
  • Ability to charge premium prices
  • Increased profit