In commerce, production refers to the process of creating goods or services. It is an important part of the overall economy.
The purpose of production is to generate profit. In order to do this, companies must have a competitive advantage over their competitors. This means they will be able to produce their goods or services at a lower cost than others in their industry.
Production can be broken down into three basic stages:
1) Inputs – The raw materials, labor, and capital used to produce goods and services.
2) Process – The conversion of inputs into finished goods and services.
3) Outputs – Goods and services produced by a business entity that are ready for sale or use.
Production can be broken down into three categories: primary industry, secondary industry, and tertiary industry.
The concept of production has been extended over time to include new ways to increase the efficiency of the production process itself. This includes concepts such as lean manufacturing, just-in-time manufacturing, mass customization, and supply chain management. In addition to efficiency improvements in how products are made, post-production activities like logistics and maintenance have become more important than ever before.
