What Are the Advantages and Disadvantages of the Production Concept?
The production concept emphasizes large-scale production at a low cost: it may help companies produce large volumes, offered at good prices, to consumers, but that might result in lesser-quality products and preclude companies from competing in certain markets in turn. The production concept is used along with four other marketplace concepts to guide organizational activities; these orientations include product, selling, marketing and social marketing concepts. The production concept is the oldest of those concepts and is often favored as a business strategy in emerging markets and in developing nations.
Multinational corporations and large retailers are prime examples of organizations that are driven by the production concept. They focus on giving consumers affordable products that might be relatively basic in design but are readily available. Companies that operate using the production concept often enjoy continual, consistent sales volumes: consumers remember the brand name and know that they can find those products in many locations. However, organizations that follow the production concept focus on mass distribution and efficient production. According to Udemy, companies give consumers what they want by selling generic and basic products and may fail to attract the most discerning consumers and compete with companies that offer new and innovative products that are superior in quality, performance and even features.