Loading…
Loading…
GCSE Business · key term
The transformation of resources, such as materials, labour and equipment, into finished goods or services.
Used by AQA and OCR
Paper 1
Revise: Methods of ProductionProduction means transforming resources into finished goods or services. A furniture maker combines timber, equipment and workers' skills to produce a chair. A hairdresser uses labour, equipment and products to provide a service.
Paper 2
The transformation of resources, such as materials and labour, into finished goods or services.
Develop a chain of reasoning: customisation can justify a higher selling price, but extra skilled labour and production time can also increase costs.
Do not assume that flow production guarantees low costs: the business needs sufficient sales to spread the cost of its production line over a large output.
Link the production method to the business in the question: its product, level of demand, customer expectations and available finance.
Create a free account to read GCSE Business revision notes for your exam board and track your progress.
Production transforms resources into finished goods or services. A furniture maker turns timber, fittings and workers’ skills into furniture; a hairdresser uses equipment, products and skills to provide a service. Operations involves organising these resources so that the business can deliver what customers want efficiently and to the required quality.