Producing to order Flashcards
What is producing to order
Producing to order = Where products are manufactured only after an order has been placed by a customer (Can include mass customisation).
What are some examples of producing to order
Bridges (They didn’t make multiple London bridges - It was made once the order was placed)
Yachts - You have to design the ship before a yacht is made (You’ll very rarely see an identical yacht)
New cars (Could be through mass customisation - you’ll configure the car to your liking)
Tailor made suits and wedding dresses
Subway (You basically configure a sandwich)
What are benefits of producing to order
High levels of customer satisfaction
Higher selling prices
Low levels of wastage
Appeals to a wider range of customers - People may view the product as good for the environment, or they may like the fact that the product was made for them - They get to fulfil their needs, by configuring their product.
What are some costs of producing to order
Consumers need to wait for their product - A car takes a month or two to be delivered to the customer, and a customer may not have time to make a sandwich made (they might go to tesco and grab a meal deal, as it’s quicker)
Flexibility in the production process - spare capacity (being able to take on orders if demand increases), flexible suppliers (They can supply more raw materials if there’s a spike in demand, or customise products to the customers requirements), skilled staff (Know how to fulfil a customers needs)
Difficult to deal with unexpected changes in demand
