2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16
The economy of every country is based on industrial enterprises that produce products or provide services. The quantity of products manufactured by an enterprise is an indicator for assessing the effectiveness of a company, industry, and even the entire national economy.
What is the product
Product is the result of an enterprise's activity, represented by a set of material products and services ready for sale.
The product manufactured by the enterprise is an important indicator. So, output characterizes the efficiency of the enterprise and labor productivity. Also, according to the commodity volume, conclusions can be drawn about the production capacities and the level of equipment. The information obtained allows us to identify problems that arise at different stages of production, to assess the potential and reserves.
Thus, the products are the result of the work of the company and can be expressed in different forms.
Product Shapes
The company's products can take two forms:
- Products - parts, finished products,semi-finished products and other types of products, the dimensions and volumes of which can be expressed in physical units.
- Services - work aimed at improving the useful qualities of the goods (for example, painting) or restoring lost properties (repair). Services of an industrial nature are associated with an increase in the consumer value of products created earlier: grinding, installation, commissioning, etc.
The intangible form of products has gained particular popularity in recent years. Depending on the nature of the work performed, market and non-market services are distinguished.
Market services include:
- settlement products of banks and other financial institutions that collect, transfer and distribute monetary resources;
- non-banking services - wholesale and retail trade, repairs, communications, rental, rental, laundry and dry cleaning services, education, catering, hairdressing, legal advice, etc.
Non-market services include costs that are covered by funds from the state budget or voluntary contributions (services of government agencies, public organizations, etc.).
Product types
In modern production, the following types of product are distinguished:
- The main product is a specific type of product for which production has been organized.
- By-product - in some industries, technological capabilities allow you to create along with the main productyet another product that has its own set of useful properties. For example, the production of cake at an oil plant.
- Affiliated product is a product created from the same raw materials as the main product, but using a different technology.
- Production waste - during the processing they have lost their useful properties and cannot be used for production.
- Rejection - products of the enterprise, unsuitable for use and further production. The level of marriage is an important indicator on the basis of which one can judge the efficiency of production and the degree of technical and technological development. The lower this indicator, the higher the productivity of the enterprise.
Classification by degree of readiness
All manufactured products are divided into the following groups according to the degree of readiness:
- Work in progress is a product that has passed only the initial stages of processing and has an unfinished presentation. Also included in this category are finished products that have gone through all the production processes, but have not yet been issued an invoice and have not arrived at the warehouse.
- Semi-finished products are parts and products that have passed all technological operations in one workshop, but are subject to processing in other production operations. The semi-finished product is subject to a special test for suitability, after which it is documented.
- Finished products are goods that have passed the full cycle of processing and all the production processes of the enterprise. It is tested for suitabilityoperation and after that it goes to the warehouse of finished products or is delivered to the customer. Finished products are produced in the main production. Quite often, enterprises create auxiliary workshops that manufacture products that accompany the main product. For example, packaging containers, product storage tanks, etc.
Product quality assessment
All manufactured products must be certified before being put on store shelves. Product certification is a procedure, the purpose of which is to confirm the conformity of the product with the requirements established by law. First of all, this concerns quality and safety criteria.
In world practice, certification of products is carried out by different methods of confirming the object to the specified requirements. If, according to the results of the check, the products meet all the criteria, the company receives a document - a certificate of conformity. It is issued by independent organizations accredited by government ministries and agencies.
Goals of certification
The certification procedure is carried out to achieve the following goals:
- consumer protection from an unscrupulous manufacturer;
- control of product safety for human he alth and life, its property and the environment;
- Checking the compliance of the product quality level with the indicators declared by the manufacturer;
- improve product competitiveness;
- export promotion and participation ininternational trade.
Certification can be mandatory or voluntary. Mandatory verification is a state control of quality and safety indicators that products must meet. This is important to consider for all existing manufacturers, as well as for those enterprises that are just planning to start manufacturing. The purpose of this certification is to provide proof that the product meets government regulations.
Voluntary certification can be carried out at the request of the enterprise on contractual terms between the applicant and the body performing the examination.
Features of product pricing
After the production of the product, the enterprise must calculate the price for which it will sell the product. Price is the monetary equivalent of the cost of a product. It includes all types of production costs, taxes and payments to the budget, as well as the amount of net income that the company expects to receive.
The price of products may change when production conditions change. Thus, an increase in the volume of goods leads to a decrease in shift costs per unit of output. A decrease in costs affects the cost of goods. Well, if an enterprise has purchased new equipment and improved the technological process, this will most likely lead to an increase in the price of manufactured products.
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