- How the transformation industry is defined
- Transformation scheme
- Goals of the Transformation Industry
- Functions of the processing industry.
- Purchase function
- Production function
- Distribution function
- References
The transformation industry is the one responsible for the processing of various inputs or raw materials, so that they can be transformed into new articles or goods for human consumption.
Sometimes, the change that materials go through within the transformation industry is such that they cannot be recognized in the final product. However, on other occasions, the change is minimal and the material retains many of the characteristics that it displayed before being transformed.
The importance of this type of industry lies in the fact that the industrialists who process raw materials will never sell them as they are and as they bought them. In fact, they will always try to sell them after going through a rigorous transformation process that makes them even more attractive for human consumption.
Therefore, the final price of the transformed materials will not be exclusively linked to the inputs that make them up, but also to the processes they had to go through to achieve a new desirable shape for the consumer.
In this sense, the transformation industry is responsible for both the acquisition of materials and their transformation, making use of various production methods, until obtaining a finished product suitable for human consumption.
How the transformation industry is defined
At the heart of any manufacturing industry are transformation technologies. In this sense, any process can be understood as a system in which various inputs interact with technology to become products.
This is how the manufacturing industry has a group of resources (inputs) and a number of processes designed to modify the state of these resources.
Transformation scheme
The processes within the transformation industry are made up of an input current and output potential scheme.
This means that the input stream will always be composed of the inputs or raw materials necessary to make a product, and the output potential will always be defined as all the operations that take place to transform the raw material.
These operations include equipment, trained labor, time, direction, financial resources, among others.
Goals of the Transformation Industry
The main objectives of all those industries that are dedicated to the transformation of raw materials are the following:
1 - Manufacture high quality products, without this representing economic losses for the company. In other words, costs must always be under control without affecting the final quality of the product.
2 - Satisfy production demands according to what the market is requesting.
3 - Reduce costs and if possible, increase the quality of the product.
4 - Increase the productive capacity of the company, according to its strategic objectives.
5 - Increase the profit margin while providing excellent working conditions to the staff.
6 - Be highly productive, that is, achieve a balance between the volume of manufactured products, the resources used for their production and the volume of sale of the same. In essence, this is the primary goal of the processing industry.
Functions of the processing industry.
The transformation industry mainly fulfills the functions of acquiring raw materials, assigning the necessary labor for their transformation, controlling the costs derived from production, and ensuring the correct completion of the product and its distribution.
All these functions are mainly divided into three categories which are described below:
Purchase function
The purchasing function is responsible for obtaining the inputs or raw materials necessary to carry out the production processes.
In this way, the inputs must meet certain standards that ensure the quality of the products once they are transformed.
On the other hand, the purchasing function must take care of costs and delivery times, in such a way that these two variables do not have any kind of repercussion on the final consumer.
In order to be able to carry out the transformation processes of the material on time, it is necessary that the purchases be made in advance.
It is also important to consider the volume of purchases to be made, as this should not interfere with inventory logistics.
The purchasing function generally has a statistic that allows to analyze the behavior of the suppliers.
Production function
The production function is the most visible and significant within the processing industry. This function is in charge of transforming inputs and raw materials into finished products, suitable for human consumption.
This function takes into account that the transformation of the inputs does not affect the quality and price of the final products.
It is the function that encompasses the basic resources necessary for manufacturing, which include inputs, machinery, labor, external services and money.
All manufacturing industries depend on this function to collect, record and control the costs derived from the transformation of materials.
Distribution function
Once the processes of purchase and transformation of the material have been successfully completed, the final products must be transferred to a warehouse.
From this warehouse the distribution function is carried out, through which the articles are packed and dispatched to the clients, according to their previous requests. During the distribution function, sales are closed.
Some of the main activities carried out with the distribution function are the following:
1 - Operation and inventory management of finished products in the warehouse.
2 - Output control of the products to the customer's facilities.
3 - Control of costs derived from the movement of products from the warehouse to the client's facilities.
4 - Registration of all the information derived from the distribution of the finished products.
5 - Collection of outstanding accounts to clients.
References
- ABC, D. (2017). Definition ABC. Obtained from Definition of Manufacturing Industry: definicionabc.com
- Characteristics, E. d. (2017). Characteristics. Obtained from 10 Characteristics of the Manufacturing Industry: caracteristicas.co
- (July 2012). ContaCostos. Obtained from Characteristics and functions of the transformation industry: contacostos-contabilidaddecostos.blogspot.com.br
- (2017). Definition. Obtained from Definition of Manufacturing Industry: definicion.mx
- (September 24, 2002). Gestiopolis.com. Obtained from Characteristics of the modern transformation company: gestiopolis.com