Certified Supply Chain Professional (CSCP) Practice Exam

How does modularization help in reducing costs?

1. By using different components for every product

2. By using the same item to build a variety of goods

3. By increasing the number of parts required

4. By using only specialized items for production

The correct answer is: By using the same item to build a variety of goods

Modularization reduces costs primarily by allowing manufacturers to use the same components across different products. This strategy promotes efficiency in production and supply chain management, as it simplifies inventory management and reduces the need for multiple unique parts. By using standardized components, companies can achieve economies of scale since they can produce larger quantities of the same part, leading to cost savings in both production and procurement. This approach not only streamlines assembly processes but also enhances flexibility in design and manufacturing, as a single module can be integrated into various final products. Ultimately, this results in lower overall costs while maintaining product variety and meeting customer demands effectively.