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Discuss how stock control and quality control achieve efficiencies for a business such as M6 Motors. - Leaving Cert Business - Question 5(B) - 2022
Question 5(B)
Discuss how stock control and quality control achieve efficiencies for a business such as M6 Motors.
Worked Solution & Example Answer:Discuss how stock control and quality control achieve efficiencies for a business such as M6 Motors. - Leaving Cert Business - Question 5(B) - 2022
Step 1
Stock Control
Answer
A business needs to control its stock to ensure it has optimum stock levels to meet customer demand at all times. Maintaining the right amount of stock is crucial; too much stock can lead to several issues such as:
- Obsolescence: Unused stock may become outdated and lose its value over time, especially in the automotive sector where models frequently change.
- Tied-up Capital: Excess stock ties up financial resources which could have been utilized elsewhere in the business.
- Increased Storage Costs: More stock requires larger storage facilities, leading to higher operational costs.
- Risk of Theft: Larger quantities of stock can attract theft, resulting in financial losses.
On the other hand, having too little stock can also have negative consequences, such as:
- Lost Sales: Inability to meet customer demand can result in lost sales opportunities and dissatisfied customers.
- Reduced Customer Loyalty: Customers may turn to competitors if they find that a business frequently runs out of stock.
- Potential Damage: Insufficient stock levels can lead to rushed orders, which may cause mishaps in the supply chain.
Step 2
Quality Control
Answer
The aim of quality control is to ensure that all products reach a specific standard set by the business, the industry, or relevant organizations. Maintaining this standard is vital for customer satisfaction and brand reputation.
- Appointing a Quality Controller: Businesses can employ a quality controller who is responsible for ensuring products meet established standards.
- Regular Physical Inspections: Routine checks and inspections can help identify any flaws in the products before they reach the customer, thus preventing dissatisfaction.
Such systems of quality control result in consistent product quality, leading to greater customer satisfaction. Additionally, businesses can apply for quality awards such as the Q Mark or ISO 9000, which can significantly enhance their credibility in the market.