September 2010
Intermediate to advanced
288 pages
10h 16m
English
Content preview from Logistics and Supply Chain Management, 4th Edition
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LOGISTIC S & SUPPLY CHAIN MANAGEMENT
154
It has been suggested that under the economies of scope model:
… a single plant can produce a variety of output at the same cost as (if not lower
than) a separate plant, dedicated to producing only one type of product at a
given level. In other words an economic order quantity (EOQ) of one unit, and
specific production designs, engender no additional costs. Economies of scope
change the materials-driven, batch-system technology into a multi-functional,
flow system configuration.
SOURCE: D. LEI AND J.D. GOLDHARS
5
The marketing advantages that such flexibility brings are considerable. It means
that in effect the company can cater for the precise needs of multiple customers,
and they can offer ev
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