Batch Production

Batch production is similar to job production, but instead of making singular items, groups of items are made together. A baker making batches of loaves of bread is an example of batch production.

Batch production advantages

Lower average costs than job production (overheads spread across items).
More efficient than making single items.
Allows some product variety (e.g. different flavours, sizes, or designs).
Suitable for medium demand levels.

Batch production disadvantages

Machines must be cleaned or reset between batches, which is costly and time-consuming.
Workers and machinery may be left idle during changes.
Less flexible than job production for highly customised items.
Not as efficient as flow production for mass markets.

Lower average costs than job production

Batch production usually has lower average costs than job production because small quantities are made together.
This means that overheads like electricity for a baking oven can be shared across more than one unit of output.

Costs of switching production

When changing production, machines have to be washed down and this can be costly and time consuming.
- For example, when Cadbury makes moulded chocolate bars that contain nuts (e.g. Fruit and Nut), the same machinery has to be washed and prepared to avoid cross-contamination. Otherwise, consumers that have nut allergies may become ill or die.

Example

Cadbury uses batch production to make different types of chocolate bars, requiring machinery to be washed between products.

1Understanding Business Activity

1.1Business Activity

1.1.1Purpose of Business Activity

1.1.2Customer Needs

1.1.3Why are Businesses Set Up?

1.1.4Specialisation & Division of Labour

1.2Classification of Businesses

1.2.1The 3 Sectors of Economic Activity

1.2.2Public & Private Sector

1.3Enterprise, Business Growth & Size

1.4Types of Business Organisation

1.4.1Sole Traders

1.4.2Partnerships

1.4.3Limited Companies

1.4.4Private Limited Companies

1.4.5Public Limited Companies

1.4.6Unlimited vs Limited Liability

1.4.7Not For Profit

1.4.8Franchising

1.4.9End of Topic Test - Business Ownership

1.4.10Application Questions - Business Ownership

1.4.11Diagnostic Misconceptions - Company vs Business

1.5Business Objectives & Stakeholder Objectives

1.5.1The Main Stakeholders in a Business

1.5.2The Impact & Influence of Stakeholders on Business

1.5.3Diagnostic Misconceptions - Profit

1.5.4Diagnostic Misconceptions - Owners vs Shareholders

2People in Business

2.1Human Resource Management (HRM)

2.1.1Contracts of Employment

2.1.2Recruitment

2.1.3Benefits of an Effective Recruitment Process

2.1.4Reducing the Workforce

2.1.5Legal Controls Over Employment

2.1.6Training

2.1.7End of Topic Test - The Workforce

2.1.8Application Questions - The Workforce

2.1.9Diagnostic Misconceptions - Recruitment

2.2Organisation & Management

2.2.1Internal Organisational Structures

2.2.2Business Functions & Definitions

2.2.3Centralised vs. Decentralised Structures

2.2.4Tall & Flat Organisations

2.2.5The Impact of Organisational Structure on Managing

2.2.6Leadership Styles

2.2.7Trade Unions

2.2.8End of Topic Test - Org Structure

2.3Methods of Communication

2.3.1Communication in Businesses

2.4Motivating Employees

2.4.1Motivation in the Workplace

2.4.2Financial Methods of Motivation

2.4.3Non-Financial Methods of Motivation

2.4.4Diagnostic Misconceptions - Money

3Marketing

3.1Marketing & the Market

3.1.1Customer Needs

3.1.2Identifying and Satisfying Customer Needs

3.1.3The Market

3.1.4The Market-Driven Approach

3.1.5Competition

3.1.6The Impact of High Competition

3.1.7Diagnostic Misconceptions - Competition

3.1.8Market Segmentation

3.1.9Methods of Market Segmentation

3.2Market Research

3.2.1Market Research

3.2.2Qualitative & Quantitative Research

3.2.3Primary Market Research

3.2.4Secondary Market Research

3.2.5Analyse Market Research Data

3.2.6Application Questions - Marketing

3.2.7End of Topic Test - Marketing

3.3Marketing Mix

3.3.1The Product Life Cycle

3.3.2Product Design

3.3.3Product Portfolio & The Boston Matrix

3.3.4Benefits & Risks of New Products

3.3.5Extension Strategies

3.3.6Price

3.3.7Pricing - Skimming & Penetration

3.3.8Competitive and Cost-Plus Pricing

3.3.9Market Mapping - Price vs Quality

3.3.10Place

3.3.11Manufacturer-Wholesalers-Retailers-Customers

3.3.12Manufacturer-Retailers-Customers

3.3.13Direct to Customers

3.3.14Promotional Methods

3.3.15Reasons for Promotion

3.3.16Advertising

3.3.17Advertisement - Product Placement

3.3.18Public Relations

3.3.19Sales Promotion

3.3.20Sponsorship

3.3.21Social Media

3.3.22Promotional Mix

3.3.23E-Commerce and M-Commerce

3.3.24Benefits & Drawbacks of E-Commerce and M-Commerce

3.3.25End of Topic Test - Marketing Mix

3.3.26Grade 9 - Marketing Mix

3.3.27Diagnostic Misconceptions - Decreasing Price

3.3.28Diagnostic Misconceptions - Advertise vs Promote

3.3.29Diagnostic Misconceptions - Social Media

3.3.30Marketing Strategy

3.3.31Entering Foreign Markets

3.4Legal Controls

3.4.1Legal Controls on Marketing

4Operations Management

4.1Production of Goods & Services

4.1.1Production Processes Overview

4.1.2Job Production

4.1.3Flow Production

4.1.4Batch Production

4.1.5Production Efficiency - Lean Production

4.1.6Managing Stock - Just in Time

4.1.7Technology & Production

4.1.8Factors of Production

4.1.9Diagnostic Misconceptions - JIT vs JIC

4.2Cost, Scale of Production & Break-Even Analysis

4.2.1Costs

4.2.2Costs - Calculations

4.2.3Economies of Scale

4.2.4Diseconomies of Scale

4.2.5Break-Even Analysis

4.2.6Profits and Losses - Calculations

4.2.7Diagnostic Misconceptions - Fixed Costs

4.2.8Diagnostic Misconceptions - Economies of Scale

4.2.9Diagnostic Misconceptions - Break-Even

4.3Achieving Quality Production

4.3.1Importance of Quality

4.3.2Measuring Quality

4.3.3Quality control

4.3.4Total Quality Management

4.3.5Benefits of Maintaining High Product/Service Qual.

4.3.6Costs of Maintaining High Quality/Service

4.3.7End of Topic Test - Operational Decisions

4.4Location Decisions

4.4.1Business Location

4.4.2Nature of Business Activity

5Financial Information & Decisions

6External Influences on Business Activity

6.1Economic Issues

6.1.1Business Cycle

6.1.2Objectives of Government Economic Policy

6.1.3Provision of Public Services

6.1.4Taxation & Constraints on Public Spending

6.1.5The Government & Business Activity

6.1.6Interest Rates

6.1.7Interest Rates - Calculations

6.1.8Diagnostic Misconceptions - Recession

6.2Business & the International Economy

6.2.1Multinational Companies

6.2.2Exchange Rates

6.3Business & the Environment

6.3.1Globalisation

6.3.2Environmental Issues

6.3.3Business and Sustainability

6.4Business & Ethical Issues

6.4.1Ethical Considerations for Businesses

6.4.2Benefits of Being Ethical

6.5Pressure Groups

6.5.1Pressure Groups

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