Business operations (unit 3) Flashcards
What is quality?
how well a product performs or the standard to which a service is provided
What does it mean if a quality is of good service?
if a product or service is of good quality, it generally means that it is of high standard
Where can quality come from?
how well a product is made
the use of high quality raw materials
ensuring products will last a long time and work well
Customer expectations when it comes to quality
customers often have high expectations about the quality of goods and services they receive
- customers expect to receive a product or service that performs as described
- many customers also expect products to be produced in an ethical sustainable way
2 ways of managing quality
quality control
TQM
What is quality control?
the process of inspecting products or services to ensure that customers receive them at a high standard
This can be done by feedback or factor inspectors
Feedback in quality control
can be physical at point of sales or electronically to ask about the service customers received
Factory inspectors in quality control
often used at the end of production to ensure that products are of the required standard before they reach customers
What do quality control methods do?
these methods reduce the number of faults or sub standard products that reach customers
Disadvantage of quality control
these methods identify faults at the end of production which is more expensive to fix as the whole product may have to be replaced
What is TQM?
a process of carrying out checks at specific stages during the production process. Faults are found sooner rather than later
TQM makes quality the responsibility of all employees
Advantages of TQM
cost reduction as faults found early
reduced waste
increased customer satisfaction
Disadvantages of TQM
cost of training
can be time consuming to introduce
all employees must belive in TQM
Benefits of maintaining quality
Helps build strong brand image
gain good rep
customer satisfaction
gain competitive advantage when can offer low prices high quality
Costs of maintaining quality
mistakes are expensive
inspection costs
staff training costs
3 methods of good customer service
good product knowledge – every staff member should know all the features and benefits of the product
Customer experience – employees should try to build relationship relationships with customers like being polite and friendly or fitting rooms to make customer experience more enjoyable
post sales services – after a product has been purchased the business may need to provide an ongoing service e.g. use our training – showing how to use the product, helpline – can call line for help, servicing – some products require regular services to keep them running correctly
Benefits of providing good CS
customer satisfaction – happy customers will recommend business to others and leave good social media reviews
Customers are loyal – make repeat purchases
Customers are willing to pay more
Drawbacks of providing good customer service
higher staff wages – from hiring experts in customer service
Paying for staff training
What is organic growth?
Internal
franchising , opening new stores , outsourcing
What is inorganic growth?
external
mergers and takeovers
What is franchising?
a franchise is a business that gives the right to another person or business to sell goods or services using its name
They do this by providing them with a licence
Franchisee
someone who purchases a franchise
Franchisor
someone who sells a franchise in return for a fee
Advantages of a franchise
already established business making it easier to make money
lower risk for franchisee
Disadvantages of a franchise
loss of some decision making for franchisor
franchises are expensive to set up
Opening new stores
can be done either nationally or internationally
Ecomerce in expansion
involves selling products online
established businesses can have online stores as well as physical ones
Advantages of e-commerce in expansion
provides a business with a much larger market
Disadvantage of ecomerce in expansion
expensive to set up
outsourcing
outsourcing occurs when a business pays another firm to produce its products. This allows the business to increase its capacity quickly with minimal investment
Disadvantages of outsourcing
The business will lose control and their reputation could be damaged if the products are not the same quality
What is procurement?
means getting the right supplies from the right supplier at the right price and at the right time
What is logistics?
Means making sure the correct products are produced and that they will arrive when needed. Involves transportation storage and distribution
Transportation in logistics
Is the process of getting goods or services from one part of the supplied chain to the next. Could involve a global or local travel (boats, planes, lorries, vans)
Storage in logistics
(Warehousing) involves storing products before they are sent out to retail shops or direct to the customer if sold online
Distribution in logistics
ensures product make their way to the end customer in the most efficient way possible
What is a supply chain?
refers to all the business, people and activities that take part in the production processes from start until it reaches the customer
Benefits of an effective supply chain
getting goods and services for the best price and value
working with suppliers to ensure that key processes are running effectively and cost effectively
cut waste and unccessaey costs to create fast production
more satisfied end customers resulting in less complaints and lower return rate
Cutting down supply chain costs
streamline transportation- inefficient transportation and logistic processes lead to higher shipping costs, longer delivery and customer dissatisfaction
implement continuous improvement practices - evaluating existing processes and identifying areas where improvements can be made
Cutting down waste in the supply chain
manage resources- such as your product transportation
use lean production - during production
