News

What are the advantages and disadvantages of large scale production?

Currently, many businesses, instead of choosing small factory designs, have chosen a larger size factory model to produce on a large scale. This form has certain advantages, but any production model is limited and so is the large scale production model. Let's find out what the pros and cons are through this article!

Advantages of large-scale production


1. Using modern and specialized machines to increase productivity

In contrast to the small workshop design model, the large scale production model requires a large size factory area to allow sufficient space for the use of machinery. Each manufacturing industry needs different types of specialized and modern machines for each stage, so the allocation of production areas is essential. However, depending on the industry and the cost of each enterprise, the large-scale production model will work.

2. There is a division of labor, increasing work efficiency

In large enterprises, the working model will be divided according to specialization, each individual will be in a fixed and intensive position. Therefore, large-scale production is essential to making the best use of workers' work capacity. For SMEs, it is necessary to optimize manpower and production space to meet the actual conditions of the company.

3. Saving production costs

The management and distribution costs per unit of production in a large enterprise will be much less. Interest rates, bills and other expenses are the same, big or small. Therefore, the same amount of spending is distributed on a larger volume resulting in lower cost per unit.

4. Easy to get loans

A large-scale production model can take advantage of the financial economy. With strong economic potential, a large business model can ensure credit facilities at low prices. Low credit costs reduce production costs. These are some of the advantages that a large scale enterprise has over a small scale enterprise. It can produce better goods at lower costs

Disadvantages of large-scale production

1. Lack of supervision

A large scale manufacturer cannot pay enough attention to detail. Costs often increase due to employee dishonesty or waste of their materials. This is due to the lack of supervision. Due to the laxity of control, production costs will increase.

2. Dependence on foreign markets


A large manufacturer often depends on foreign markets. Overseas markets may be affected by the war or some other upheaval. This makes the business very easy to face risks.


3. Need large capital


Unlike small production models with small factory designs, large quantities are required to have strong capital resources. In the absence of capital, large-scale industries face many difficulties and are under pressure.

4. Difficult management


Managing large businesses is very complex and costly. In order for businesses to operate smoothly, it is necessary to have a professional management system. Otherwise the business will suffer many fluctuations, causing economic losses.


Thus, each production model has its advantages and disadvantages for businesses. However, no matter which type you choose, small or large design workshops is an important profit for your business. Hopefully the article above provides useful information for businesses.

Related

07/26/2017, News
Solutions for environmental...
Although the paper production industry in general and paper package production industry in particular is considered very potential with...
07/22/2017, News
Useful information for...
With powerful Industrialization and Modernization, mechanical industry plays a very important role and has a great influence on the overall...
04/24/2017, News
How does waste from...
To meet the increasing demand of using electronic equipment, domestic and foreign enterprises have been actively investing in building a lot of...
06/17/2017, News
Changes in landline...
The change will take place within 1 month for each phase. During that time, both new and old phone area codes are running in parallel. After the...
05/08/2018, News
Kouyo Co., Ltd. installed...
Recently, Kouyo Co., Ltd., a Japanese investor in Kizuna Serviced Factory, has installed a new machine for its factory. Founded in February 2016 by...
10/16/2018, News
Japanese companies...
The fair took place from October 13th to 21st, 2018 with more than 400 booths of companies, provinces, and cities participating in the exhibition,...
09/18/2017, News
Vietnam – “green”...
In recent years, industry of manufacturing essential oils has been entered to our country and rapidly accounted for a large part in the share of...
10/18/2018, News
KIZUNA and the delegation...
On Oct 8th, 2018, the delegation of Long An province led by Mr. Nguyen Van Duoc – Vice Chairman of the provincial People’s Committee held an...
09/21/2018, News
Occupational safety and...
The companies operating in the Kizuna Serviced Factory are mostly small and medium enterprises, so they encounter many difficulties to organize...
08/29/2018, News
Kizuna Blooming Party 2018...
On the occasion of Kizuna 6th anniversary, on August 24th, Kizuna JV Corporation held the Kizuna Blooming Party 2018 with the participation of many...