Reducing the cost of production may lead to lower quality products or services. Customers may become dissatisfied as a result, and brand reputation may suffer.
What reduction of cost of production does to business
- Thread starter Johnson2468
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Production costs consist of labor, raw materials and FoH, so reducing production costs will not always reduce price quality, for example, reducing labor is replaced by machines or robots, at FOH we can also reduce, use of factory buildings that are too large, replace spare parts do not have to buy but take from broken old machines etc. The production quality of your goods will remain guaranteed and of high quality.
You are right reduction in the cost of production only brings low taste and reduction in customer Base.
I see positivity in a reduction of cost of production because it frees up funds that the owner can use for paying me tasks
Reducing cost production may lead to increase in profits. That said, it should be done without compromising product quality. Otherwise, you will lose customers and your brand reputation may be seriously affected.
Yes, that's right. People always want quality products and they do not negotiate it.
Reduction of production cost can be direct or indirect. Direct can in area of raw materials that is involve in production. Indirect can be in area of amount of products produced. But is mostly direct. Well, in whatever form, reduction in production do affect quality and quantity of products produced.
The cost of producing anything is so high that for you to finish your Production and set your price, you would realize that the market might not be able to buy. And then to maintain the same quantity and quality, you would have to increase your price which the customers might not like. So they reduce the quality and quantity while still keeping the price.
If you want to make good profit from your business, it is very important for you to try as much as possible to reduce your cost of production because it will always affect your profit margin.
The reduction in the quality of goods and services should not be encouraged because it will make the business to dwindle.
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The reduction in the quality of goods and services should not be encouraged because it will make the business to dwindle.