In continuous production, the production is continuous,24×7 hours, in a year.Īn example of Continuous production is brewing. But, in continuous production, most of the work is done by machines rather than humans. In Mass production, both machines and humans work together. It can be differentiated by the amount of mechanical work involved. There is a lot of similarity between mass production and continuous production. Continuous Production or process production Mass production requires huge initial investment and working capital. However, the production capacity of the company determines the success of mass production. Market demand does not play a major role in Mass production. As a result, these workstations are very efficient and production due to which the whole assembly line becomes productive and efficient. The work is done in such a manner each workstation is responsible for one single type of work. There are multiple workstations installed and the assembly line goes through all the workstations one by one. For example- the manufacturing process adopted by ford company.Īn Assembly line or mass-production plant is typically made for specialised product manufacturing. This is one of the most common types of production systems used in the automobile industry and is also used in industries where continuous production is required. Mass production is also known as flow production or assembly line production. For example – the production the seasonality of products heavily depends on the demand. Demand and supply play a major role in batch production. It is also used in Medicines, Hardware, Consumer durables and many such industries.īatch Production is done in batches, so once a batch production starts, stopping the process midway may cost a huge amount to the company. The manufacturer needs to know the number of units he has to manufacture, and they are manufactured in one batch.Įxamples of batch production are FMCG like Biscuits, confectionaries, packaged food items etc. And, during periods of economic expansion, they invest in capital to purchase machinery and equipment to bring new products to market.īatch production is most commonly used in consumer durables, FMCG or other such industries where there are a large variety of products being manufactured with variable demands. But buying a vehicle for commercial uses considers as capital.ĭuring a financial crisis or when they suffer losses, companies cut back on the capital expenditure to ensure profits.
Buying a car for personal use and family transport is not considers capital. It is important to distinguish between private capital and personal capital. Money used as a resource to buy capital goods like machine, equipment, raw materials etc. But money is not a factor of production, because money is not directly involved with the production of product or services. CapitalĬapital generally refers to money. Skilled and trained workers are referred to as human capital and they get paid at higher wages because they bring more than their physical capacity to the workplace. Hire skilled labour for their specific work increase the productivity of a production unit. Labour by an uneducated and untrained worker is generally paid at low wages. The combination of an adequate number of labour with suitable skills and reasonable labour wages can highly benefit the production firm. Another important factor that influences plant location decisions is the availability of labour near the factory. Skilled labour can make a significant difference in any production. Human effort is a necessary factor for production. For such industries extreme humid or dry conditions are not suitable for production. In the production of leather, textile, etc. Depending upon the nature of the plant water should be available in adequate quantity and proper quality. Water is used for processing, drinking and sanitary purpose within a production site. influence the selection of plant location.
Area, the shape of the production site, cost, drainage, and other facilities, the probability of floods, chance of earthquakes, etc.
Cultivation of crops on land by farmers increases its value and utility. Natural resources, such as oil and coal, can be extracted from the land and refined for production purpose consumption.
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