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Consideration of market demand volatility risks, when making manufacturing system investments
Global Industrial Development, Scania CV AB, Södertälje, Sweden; Department of Engineering Science, University West, Trollhättan, Sweden.
Örebro University, School of Science and Technology.ORCID iD: 0000-0003-1408-2249
Department of Engineering Science, University West, Trollhättan, Sweden.
2016 (English)In: 13th Global Conference on Sustainable Manufacturing - Decoupling Growth from Resource Use, Elsevier, 2016, Vol. 40, p. 307-311Conference paper, Published paper (Refereed)
Resource type
Text
Abstract [en]

When investing in new manufacturing systems, many aspects must be taken into consideration to ensure a sustainable business. In respect to the financial aspect, both the one-off investment cost and the continuous operational cost must be analysed to ensure that the life-cycle cost perspective is appreciated. However, one detail in the cost analyses that is often overlooked is the composition of fixed and variable cost elements. These details are important to be able to better manage the risk of market demand volatility, and accordingly make appropriate investment decisions. This case study demonstrates that when there is a low risk for reduced market demand, investing in a manufacturing system with low variable cost is favourable. However, if there is a high risk for reduced market demand, the importance will instead be to have a low fixed cost, as this will be the dominant cost factor. (C) 2016 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0) Peer-review under responsibility of International Scientific Committee of the 13th Global Conference on Sustainable Manufacturing

Place, publisher, year, edition, pages
Elsevier, 2016. Vol. 40, p. 307-311
Series
Procedia CIRP, ISSN 2212-8271 ; 40
Keywords [en]
Manufacturing System, Sustainable, Investment, Finance, Case Study, Cost Analyses, Risk Management
National Category
Environmental Sciences
Research subject
Enviromental Science
Identifiers
URN: urn:nbn:se:oru:diva-51580DOI: 10.1016/j.procir.2016.01.044ISI: 000379243200054Scopus ID: 2-s2.0-84966657934OAI: oai:DiVA.org:oru-51580DiVA, id: diva2:950946
Conference
13th Global Conference on Sustainable Manufacturing - Decoupling Growth from Resource Use, Binh Dong New City, Vietnam, September 16-18, 2015
Available from: 2016-08-04 Created: 2016-08-04 Last updated: 2017-10-17Bibliographically approved

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Pejryd, Lars

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CiteExportLink to record
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Cite
Citation style
  • apa
  • ieee
  • modern-language-association-8th-edition
  • vancouver
  • Other style
More styles
Language
  • de-DE
  • en-GB
  • en-US
  • fi-FI
  • nn-NO
  • nn-NB
  • sv-SE
  • Other locale
More languages
Output format
  • html
  • text
  • asciidoc
  • rtf