PRODUCTION | @gwillchrist

In modern economy, production is the heart or engine of an economy and the yardstick for measuring the level of industrialisation. On daily basis, people are engaged in various types of work to sustain their livelihood and to meet their basic needs. All these sets of people are directly or indirectly involved in the production process. Production process makes specialisation essential and exchange compulsory.

The word production encompasses many activities, starting from any activity that is aimed at making money and has succeeded in making money for the productive activity. Production is simply an act of providing goods that have utility and services that can be priced and paid for.

Broadly, production is the conversion of raw materials into finished goods

With their distribution to the ultimate consumers to satisfy their wants. Production involves a systematic way of creating economic activities aimed at producing goods and services and the distribution of these to the ultimate consumers for the satisfaction of their wants and for a value. There are many ways to define production; the main

Features of all these definitions can be explained in the following:

Production must be an active process that should provide human needs, which can be exchanged for value, i.e ., money.

The goods and services to be produced must be available for purchase by the ultimate consumers.

• Direct production
• Indirect production

The types of production stated above are explained below.

This is a form of production normally done in a small scale with the motive of meeting the immediate needs of the producer’s family. Examples are the processing of cassava to make garri for household consumption, baking of cakes and bread in small quantity for family’s consumption, etc. In this case, the goods and services so produced are not for sale.

This is a form of production in which goods and services are produced in large quantity mainly for sale to the third parties.
This type of production requires the following:

• Use of modern equipment.

• Skilled and unskilled labour.

• Adequate infrastructure facilities.

• Mass production with quality control for sale to various customers to satisfy their wants.