Question

The benefit(s) of product standardization is/are:

• A. {Need of less number of drawings}
• B. {Reduction in unit cost}
• C. {Reduction in inventory cost}
• D. {Greater product variety}

Hint:

Standardization reduces manufacturing complexity, cuts costs, and streamlines inventory management, which is why it is widely adopted in mass production industries.

Answer 1

The Correct Option is A, B, C

Product standardization offers a variety of benefits, especially in manufacturing and inventory management. Let's look at each option:
1. Need of less number of drawings (A):
- Product standardization involves creating uniform products with fewer variations. This directly leads to fewer design changes and less need for multiple drawings. If the design remains the same across various products, manufacturers only need to create one or a few sets of drawings, thus reducing engineering costs and complexity.
2. Reduction in unit cost (B):
- By standardizing products, manufacturers can take advantage of economies of scale. They produce the same product in large quantities, which lowers the production cost per unit. Standardized parts can be mass-produced more efficiently, and bulk purchasing of materials reduces material costs. Additionally, the production process becomes more streamlined, which further reduces costs.
3. Reduction in inventory cost (C):
- Standardized products are easier to manage in terms of inventory. With fewer variations, companies can hold fewer types of inventory, leading to reduced storage costs. Standardization allows for better inventory turnover and minimizes the need for excess stock. Moreover, it simplifies procurement and supplier management since fewer parts are required.
4. Greater product variety (D):
- This option is actually contrary to the concept of product standardization. Standardization typically means fewer variations of a product, not more. While standardization leads to more efficient production, it does not necessarily result in greater product variety. Instead, customization would be needed to offer more variety.
Thus, the correct answer is that product standardization provides the following benefits: (A) Need of fewer drawings, (B) Reduction in unit cost, and (C) Reduction in inventory cost.