As per the latest survey by the
Federation of Indian Chambers of Commerce and Industry (FICCI), in the last few
months the rising production costs have impacted the manufacturing competitiveness.
The latest quarterly survey by the
industry body FICCI’s suggested a slight decline for the manufacturing sector
outlook in the fourth quarter of the last fiscal. This is because the
percentage of respondents reporting higher production and exports in fourth
quarter has declined as compared to the previous quarter. As per the reports,
the percentage of respondents who report lower production has reduced by half
over the previous quarter which indicates a more stable outlook in months to
come.
 |
| Source: Smallbiztrends.com |
Production cost is the cost incurred
by a business when manufacturing a good or providing a service. Production
costs include various expenses like labor, raw materials, consumable
manufacturing supplies and general overhead. Besides, production costs also
include any tax imposed by government or royalties owed by natural resource
extracting companies.
Cost of production is thus the
production costs which include expenditures relating to the manufacturing or
creation of goods or services. Production cost is the cost which is directly
related to the generation of revenue for the company. The manufacture
experience the product costs which related to both the materials required to
create an item as well as the labor needs to create it. Production cost in
service industry in regard to the labor requires providing the service as well
the material costs.
There are direct costs and indirect
costs in production. Take for example direct costs for manufacturing an
automobile are materials such as the plastic and metal materials used as well
as the labor required to produce the finished product. Indirect costs include
overhead such as rent, administrative salaries or utility expenses.
Production is the process that occurs
through time and space since it is a flow concept. Production is measured as a
rate of output per period of time. Production process is the quantity of the
good or service produced in the form of the good or service created or the
temporal and spatial distribution of the good or service produced.
Production process is an activity
that increases similarity between the pattern of demand for goods and services.
It is also the quantity, form, shape, length, size and distribution of the
goods and services available to the market place.
Production is a process combining
various material inputs and immaterial inputs to make something for consumption
and is the act of creating output, a good or service that has value and
attributes to the utility of individuals.
The expectation of manufacturers for
January-march quarter for twelve major sectors namely auto, capital goods,
cement and ceramics, chemicals, electronics and electrical, food products,
leather and footwear, machine tools, metal and metal products, paper products,
textiles and technical textiles and textiles machinery is evaluated in the
survey.
The investors can better understand
the money issue involved with new products that determine whether or not the
investor will make money on each product sold. The goal enables investors in
evaluating the perceived value of the product to the end user, understand how
much they will receive from the sale of each product based on the chosen
distribution channel and then to understand if money can be made when compared
with the amount to the manufacturing costs. People in the manufacturing
industry believe that the product has a chance to make money if the
manufacturing cost is less than 25 percent of the end user price.
The supply of various natural
resources has become scarce and expensive. It is subject to price volatility,
increasing manufacturer’s costs and risks. Opportunities are also created by
the changing landscape. In order to receive benefits from them companies must
start on a journey to transform their operations and hence try to increase
resource productivity. They will have to make significant efforts to optimize
resources in the future as in the past they had done to lean and other
improvement initiatives. Also they should rethink of the business models to
capture the value residing in resource ownership at the same time. If
everything goes on nicely the effort will enable them to increase the stability
of supply and manage their costs while developing new products and business
thus generating sustainable bottom-line value.
Register at SolutionBuggy to find 3D printing consultant / experts in quick time and get your projects done.
SolutionBuggy is an exclusive and dedicated platform for the Manufacturing Sector in India. It seamlessly bridges the gap between the industrial sector and professionals for on-demand consultation and services including projects. It connects SMEs and Large Scaled Industries with Industrial Consultants/ Experts and Industrial Product Suppliers over the internet for collaboration and success.
It is an integrated platform wherein industries can share their issues/ problems and post requirements; consultants/ experts can showcase their capabilities and offer services and solutions and suppliers can list their products to match the industry requirements.
ConversionConversion EmoticonEmoticon