7 production_process - transforming its inputs into outputs...

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tutor2u GCSE Business Studies Production process The way that businesses create products and services is known as the production process. There are three main parts to the production process as can be seen in the diagram below: A firm must purchase all the necessary inputs and then transform them into the product (outputs) that it wishes to sell. For example a football shirt manufacturer must buy the fabric, pay someone for a design, invest in machinery, rent a factory and employ workers in order for the football shirts to be made and then sold. How well-organised a firm is at undertaking this transformation process will determine its success. This is known as the productive efficiency of a firm and it will want to be as efficient as possible in
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Unformatted text preview: transforming its inputs into outputs (i.e. using the minimum number of inputs as possible to achieve a set amount of output). This will reduce the cost per unit of production and allow the firm to sell at a lower price. Ultimately, the objective of the production process is to create goods and services that meet the needs and wants of customers. The needs and wants of customers will be met if a business can produce the correct number of products, in the shortest possible time, to the best quality and all at a competitive price. Key Links for GCSE Business Studies http://www.tutor2u.net/ Discussion Board for GCSE Business Studies Other GCSE Business Studies Revision Notes and Resources from tutor2u Tutor2u GCSE Business Online Store...
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This note was uploaded on 05/20/2010 for the course BUSINESS 6 Producti taught by Professor N/a during the Spring '10 term at Open Uni..

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