Lowering the Firm’s Cost
Production cost refers to the amount of resources used to produce a product. One of the main concerns to many companies is how to lower the costs that are incurred during the production of a particular product. One way of lowering the production cost is to produce a product in larger quantities. When a firm produces a product in larger quantities, it is able to lower its cost in different ways. The production cost is shared among many products, so production cost per unit reduces the firm’s cost hence. (Koshal, 13). Once a firm produces products in larger quantities the cost used to take them into the market reduces because they are transported in larger quantities.
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But this is if it is capable and willing to take the risk of the entire investments. Entrepreneurship refers to starting a business where a person takes control of everything as far as the business is concerned while social entrepreneurship refers to starting a business to help the society. Entrepreneurship is form of entrepreneurship that is within a big business organization. Their similarities include innovative and the aspect of independence. Entrepreneurs come up with ideas that they later develop in businesses. They become their own bosses and therefore making the decisions concerning the businesses.
Griffin, Ricky. Fundamentals of management. Cengage Learning, 2013.
Koshal, R. K. (1972). Economies of scale. Journal of Transport Economics and Policy, 147-153.