Producing Goods & Services (AQA GCSE Business)
Revision Note
Written by: Lisa Eades
Reviewed by: Steve Vorster
An Introduction to Production Methods
Production is the transformation of resources (e.g. raw materials components and processes) into finished goods or services
Goods are physical products, such as bicycles and T-shirts
Services are non-physical items such as hairdressing, tourism and manicures
This process of transforming inputs into outputs (goods and services) adds value to the raw materials
Competitive businesses combine these inputs of resources efficiently, making the most of the resources so as to minimise costs and generate a profit
The method of production used for this transformation process depends upon a number of factors
The level of output required to be produced
The nature of the product
Whether the product is standardised or customised
The level of automation used in production
Job Production
Job production is where products are made to meet the specific requirements of individual customers
Each item is produced separately (a job) and the production process is tailored to the unique specifications of the customer's order
Examples of Job Production
Furniture made to order Where customers can choose the design, dimensions, materials and finishes | Tailored clothing Such as wedding suits, where each garment is made to fit the specific preferences of the individual customer | High-end jewellery Especially those with unique designs or personalised engravings |
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Job production can add significant levels of added value and can therefore be very profitable
Specialised products made by skilled craftspeople can command high prices because they are unique and can be made to meet customer needs very precisely
This advantage could be lost if items were made on a larger scale
An Evaluation of Job Production
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Flow Production
Flow production involves the manufacture of a product in a continuous sequence of operations on a production line
It involves the movement of materials or components through a series of workstations or machines
Each workstation performs a specific task or operation
As a product moves along the production line, it undergoes a series of operations, such as assembly, testing, packaging or quality control, until it is completed
Diagram: An Olive oil Production line
Large olive oil producers use flow production to manufacture standardised products
This method is commonly used in industries that produce high volumes of standardised products, such as vehicles and consumer electronics
An Evaluation of Flow Production
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Examiner Tips and Tricks
In the exam, you may be asked to recommend an appropriate production method. You should consider factors such as the cost of production, customer expectations and the level of demand. Your answer will need to refer to the business context.
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