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HOW TO REDUCE COST IN PRODUCTION AND OPERATIONS IN A BUSINESS FIRM?



                          


Production and operations involve the function of converting the input to output.
Its process is defined as input transformed into output by various process and different factors involved in that process. Input consists of raw material and output is finished goods. Aim of business is to gain maximum profit from minimum investment. So in production department have to adopt some strategies for reducing the cost. 

How to reduce cost?

If you want to reduce the cost, you should check the factors affecting the cost of production in your firm. You should adopt the latest technology for reducing the cost. We can use technology from product design to manufacturing process.
Computer integrated manufacturing helps for product designing and process design, production planning and control and production process.
We can also depend on low-cost contract workers to complete works. It also called outsourcing.
Another thing we should consider is the purchase of raw materials. We should compare the different sellers and markets before purchasing and we should always buy low-cost material with good quality.
Allow shift in working increase the production and it helps to meet the demand and supply.
Paying the invoices and debts early attracts discounts to the company. Most of the money lenders give discounts when the debt is paid earlier than the due date.







Another factor is the selling of unused products. When we adopt new technologies, the old machines became a burden to most of the companies. Companies have to sell and save these spaces for getting good storage capacity and also getting financial gains.



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