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Business Start-Ups, economies of scale = the more of a product you make,…
Business Start-Ups
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Production Methods
Batch Production
Identical items, limited number. Lower costs due to lower skill required. E.g. clothes made in different sizes
Mass Production
Every version made is exactly the same. Low employee wages though machinery costs are high. Produced in large quantities. - benefit from economies of scale E.g. pens, batteries
Job Production
Highly skilled labour, employees are paid highly. This combines with the high cost of raw materials and machinery to create a high price of consumers. E.g. Custom made wedding dresses
Business Plan
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Importance/Reasons
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Measuring performance (Sets a standard for itself, action can be taken if standard not met)
Obtaining finance (banks, government agencies may require a business plan before investing)
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A detailed written document which includes information about the business|. It outlines the firm’s aims and objectives and the strategies, such as marketing and production, that will be used to achieve them.
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economies of scale = the more of a product you make, the cheaper it becomes to produce per unit (you'll receive discounts from suppliers if you buy in bulk)