Title: How Does Specialization Help Companies Achieve Economies of Scale?
Headings: How Does Specialization Help Companies Achieve Economies of Scale?
How Does Specialization Help Companies Achieve Economies of Scale?
Economies of Scale
Specialization
Specialization Leads to Economies of Scale
Example of Specialized Labor and Economies of Scale
Additional Economies of Scale
The Bottom Line

Content: Economies of Scale
Economies of scale describes a cost advantage achieved by a company when production becomes efficient. Increasing production and lowering costs results in economies of scale because the costs are spread out over a larger number of goods. Or to look at it another way, producing additional goods does not require a significant increase in costs. Reducing the cost of units per production is the main benefit of economies of scale. Larger companies are more likely to achieve economies of scale than smaller companies because they are able to produce more goods and therefore can spread out costs over a larger number of goods. Specialization
Specialization, in economic terms, means focusing on one task rather than multiple tasks, which allows workers to perfect that one task. This is a basic concept of learning. When a person attempts a specific task for the first time they may not be proficient at it. The more time spent on practicing or learning a skill, the better an individual gets at it. And the more efficient.