Bought in components

Question 1

How are bought in components cost effective for the manufacturer?

Answer 1

1. No specialist knowledge/machinery needed
2. Less preparation time needed (no wages)
3. Components bought in bulk are cheaper because they have been mass produced

Question 2

What benefits are there to bought in components?

Answer 2

1. Guaranteed quality through policies
2. Standardised so they can be used around the world and on many products in the same factory from the same manufacturer. Also easily replaceable

Question 3

What are some disadvantages of bought in components?

Answer 3

1. Safety isn’t guaranteed as it hasn’t been tested by the company itself
2. Delays can be caused if the suppliers are late
3. If JIT is the chosen manufacturing method then it will have greater consequences and will need places for storage