Edexcel Business A Level Revision

A key difference between offshoring and outsourcing is that the offshored element of the business is still part of the same global business but outsourcing means a completely separate business takes over the work. Offshoring - When a company moves various operations to another country for reasons such as lower labour costs or more favourable economic conditions in that other country. The key reasons for this is cost minimisation as the production process can be undertaken at a reduced costs in comparison to the domestic economy. Closeness to market will reduce transport costs for businesses and might allow for easier access to consumers, particularly if operating in the country being targeted e.g. Jaguar Land Rover have set up production in China. As well as this they will take advanatge of economies of scale from operating in larger international markets and having access to more specialised suppliers and services.  However, offshoring includes the fact that public and emp...

Flow production - Items flow along the production line in a continuous process making high volumes of the exact same product. Once one task is finished the next task is started immediately, therefore time taken on each task must be the same. FLOW PRODUCTION ADVANTAGES DISADVANTAGES Costs per unit of production are reduced through improved work and material flow Very long set up time and reliant on high quality machinery, so if machinery breaks and therefore breaks the flow, production will be shut down Suitable for manufacture of large quantities High raw materials and finished stocks unless lean production is used Capital intensive which means it can work constantly without the interference of employees Goods are mass produced which means there is no customisation to meet specific needs for customers Less need for training and skill as most work is done by machines Uses specialist machinery so investm...

Job production - the production of one off items to meet the needs/specifications of each individual customer, often undertaken by small, specialist businesses. Examples of job production Artists = each picture will be unique Dental technicians = make plastic caps for teeth, each one molded to fit the patient's mouth Aircraft = built one at a time due to their size Architects = designs plans for buildings that are unique   JOB PRODUCTION ADVANTAGES DISADVANTAGES Cheap and easy to set up Individual cost of one unit may be much more expensive Customer requirements and changes can be managed so are more specific to customer needs Often labour-intensive so costs for labour are also extremely expensive Associated with higher quality as they are typically premium products Requires close consultation with the client to meet exact specification needs, as mistakes are extremely costly Employees can be bett...