Production vs Manufacturing: What Are the Differences?
When you consider production vs. manufacturing, it’s a common misconception that they’re the same thing. Many in the business world might use the terms interchangeably.
While production and manufacturing share some similarities, they are not the same process. In fact, they have some key differences, including their output.
If you need either production or manufacturing, you must understand how these two processes differ.
Read on to learn more about both production and manufacturing.
What Is Production?
In production, a process occurs where products, components, or items are made into other goods. The items might be:
- Raw materials
- Money
- Investments
- Partially finished products
When a company does production, they could be involved in creating goods like tennis shoes or cell phones. They could also be producing services like landscaping, for example.
Production can also mean that a company takes resources that they work to convert into a product. The product could then get used to creating other goods.
Production creates both products and services.
When considering a production guide, often it’s thought of in terms of input and output. A company takes resources or raw materials and uses them as input to create a good or service.
The output then becomes the product delivered to customers once the production is complete.
Consider this example with a tennis shoe company. The input might be the rubber and textiles used to create the shoes. The production uses those materials to produce the shoes, which become the output.
What Is Manufacturing?
Manufacturing is another process of creating products or goods. These get created from raw materials, which is done using machinery or equipment.
The raw materials or resources include physical items such as coal, minerals, or wood. To create the goods or products in manufacturing you need:
- Human labor
- Equipment
- Technology
As you consider this manufacturing guide, you should also know there are many types of manufacturing, including:
- Electronic contract manufacturers
- Fabrication manufacturing
- Process manufacturing
- Rapid manufacturing
- Discrete manufacturing
- Lean manufacturing
Even with all these varying types of manufacturing, the process of manufacturing usually is multistep to create the goods in the end.
For example, a furniture manufacturer might need wood and textiles to build the sofas and chairs they make. Once the manufacturer has the materials, they can hire workers and develop their type of manufacturing.
Once they have the product, they can sell it to companies or retailers.
Production vs. Manufacturing, the Differences
While the two processes might sound very similar, there are some differences.
In production, both goods and services could be created that are tangible and intangible. In manufacturing, however, raw materials and labor are used to create tangible goods or merchandise.
All types of manufacturing fall under the production description, but not all production is manufacturing.
Understanding How Production and Manufacturing Overlap and Are Different
Understanding production vs. manufacturing is about understanding what’s used and what’s created from the two processes.
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