When production happens at a overall min average cost
Increasing productivity
Can increase efficiency
Cutting costs
Businesses can improve their efficiency by cutting the variable costs (e.g. materials or wages) or fixed costs (e.g. rent) involved with the production of a product
Reconsidering product design mix
Businesses may reconsider a product's design mix so that it's easier or cheaper to make
Adopting lean production
A business may adopt a lean production approach, which is when they focus on minimising waste to reduce the costs of making a product