Strategic planning in the enterprise: what are the ways to increase the volume of production?

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

The production process at any enterprise is inextricably linked with the volume of products sold, which is controlled by consumer demand. By choosing this or that product, the buyer motivates entrepreneurs occupying a certain segment of the market to compete - in fact, dictates the conditions required for the survival of the company.

Strategic choice

Choosing the path to optimize the process, each organization raises the question of how to increase the volume of production.

Gross income (profit received from the sale of goods) is maximized by two opposite methods. The first is aimed at increasing the resources required for any production process. The second, on the contrary, reduces them. Each enterprise decides for itself which path to take.

In any case, the optimization option is discussed after the analysis of the volume of manufactured products in relation to the quantity of goods sold has been carried out. It is important to conduct market research onthe subject of product compliance with the requirements of buyers, in order to exclude the influence of negative factors.

Increasing resources

The marketing department of an enterprise, when deciding to increase production resources, relies on data collected as a result of research. The primary reason for this may be the excess demand for manufactured products.

If the price of an acceptable quality product is in the lower cost range, then it entails a natural desire of buyers to purchase products in large volumes. Ultimately, an imbalance develops. A situation arises in which the volume of production is insufficient and causes its shortage in the market.

To stabilize this process, it is required to increase the product of the product. By increasing resources and expanding the enterprise, the business owner incurs certain costs that are included in the cost of products.

In the case of excess demand, the question of how to increase the volume of production should be solved in this way. A slight increase in the final cost of the product will not scare away potential buyers, because they are confident in its quality.

Minimize costs

Let's consider the following variant of a possible situation in the consumer market. The company produces a large number of goods, the price of which is quite high. It is not possible to reduce the cost level painlessly for the enterprise. Buyers refuse goods in favor of morecheap analogue produced by competitors. This leads to overstocking of storage facilities and inevitable losses for the enterprise.

What are the ways to increase the volume of production in this case? The only right decision from a marketing and organizational point of view will be to minimize the cost of resources involved in the process of commodity formation. The result of the measures taken will reduce the cost of production.

This will bring customers back and the increased production will be successfully sold. After the enterprise stabilizes in the market, you can return to the method of increasing resources.

Competent competition

It is important to understand how to increase the volume of production in the face of serious competition. This, for example, is an expanded product line, which is certainly an advantage: a buyer who once appreciated the quality will use a familiar brand in the future.

An effective option to combat the decline in production efficiency is to eliminate defects in direct sales.