Unit 10 - Commercial Production Flashcards
Just in Time (JIT)
when a company does not allocate space to the storage of components or completed items
Just in Case (JIC)
Produces a small stock of components or products and stores them as inventory.
Lean Production
Considers product and process design as an ongoing activity and not a one-off task.
Principles of Lean production
elimination of waste, minimizing inventory, maxing production flow, Kaizen, respect/empowering workers, meeting customer requirements, designing for rapid changeover, reliable partnership with suppliers, no errors
Value Stream Mapping
Used to analyse current and future processes for the production of a product through to delivery to the consumer.
Workflow analysis
The review of processes in a workflow (e.g. production line, identifying potential improvements)
Lead Time
refers to the time between the date of purchase and the date of delivery.
5 S’s
Sorting, Stabilizing, Shining, Standardizing, sustaining practice
7 Wastes
overproduction, waiting, transporting, inappropriate processing, unnecessary inventory, excess motion, defects
CIM
Uses computers to integrate the processing of production, business and manufacturing in order to create more efficient production lines.
Elements of CIM
CAD, Planning, Purchasing, Cost accounting, Inventory control, Distribution
Quality Control
Continuous monitoring ensures that the machines perform to the pre-determined standard/quality.
Quality Assurance
The regulation of the quality of raw materials, assemblies, products and components, services related to production, and management and inspection processes.
Statistical process Control
Uses statistical methods to ensure that a process operates at its most efficient.
Cost effectiveness
Most efficient way of designing and producing a product from the manufacturer’s point of view.
Value for Money
The relationship between what something, for example a product, is worth and the cash amount spent on it
Costing VS Pricing
A production, research, retail, and accounting, a cost is the value of money that has been used up to produce something.
Fixed Costs
Costs do not change with the level of production.
Variable Costs
Costs that change in proportion to the goods or service that a business produces (reliant on output)
Cost analysis
tool used to determine the potential risks and gains of producing a product.
Break-Even
point of balance between profit and loss. It represents the number of sales of a product required to cover the total costs (fixed + variable)
Price-minus
Determine a maximum price that consumers are willing to pay for a product or service - The manufacture designs and produces within these constraints.
Retail Price
Recommended retail price (RRP) suggested by the manufacturer (MSRP) that the retailer should sell the product for.
Wholesale price
The cost of a product sold by the wholesaler.
Typical manufacturing price
It is the total costs (variable and fixed) to manufacture the product. Divide the total manufacturing/product costs by the total products/items produced to get the average cost/price per unit.
Target Cost
It is desired final cost of a product is determined before manufacturing begins.
Return on Investment
Receiving a profit (return) on money invested into the product or service.
Unit Costs
The costs a company incurs to produce store and sell one product (item).
Sales volume
It is the amount of products sold in a specified time period during regular working operations of a company.
Financial Return
It is the profits generated from a sale or investment into a company.
