What is the strategy of reducing costs by increasing production of a single type of product using existing resources called?

The strategy of reducing costs by increasing production of a single type of product using existing resources is known as economies of scale. This concept is based on the principle that as production levels rise, the cost per unit typically decreases. This can occur for several reasons: fixed costs—such as equipment and overhead expenses—are spread over a larger number of units, leading to cost savings. Additionally, bulk purchasing of materials and more efficient use of labor can further reduce costs.

In the context of operations and supply chain management, focusing on a single product allows organizations to streamline their processes, enhance operational efficiencies, and ultimately achieve a competitive advantage through cost leadership in the market. By utilizing existing resources effectively to produce at a higher volume, firms are able to leverage their production capabilities fully.

The other choices represent different strategies or manufacturing systems that do not specifically focus on the cost-reducing effect of increased output of a single product type. Flexible manufacturing systems emphasize adaptability and the ability to produce a variety of products, job shop production focuses on customized production in smaller quantities, and mass customization combines elements of both mass production and customization to meet individual customer needs.