Manufacturing Cells


DEFINITION of 'Manufacturing Cells'

Sets of machines that are grouped by the products or parts they produce in a lean manufacturing environment. This system is used in the cellular manufacturing concept, which is distinct from the traditional functional manufacturing system in which all similar machines are grouped together. The use of manufacturing cells improves material flow and is especially suited for batch production, even in relatively low volumes.

BREAKING DOWN 'Manufacturing Cells'

One of the challenges of implementing a cellular manufacturing system is the actual establishment of manufacturing cells. If the same machines are required in different cells, it may result in higher capital requirements. However, the benefits of manufacturing cells, such as higher productivity, better responsiveness to market conditions and the ability to produce customized goods in small volumes, more than offset these drawbacks.

  1. Bill Of Materials - BOM

    A comprehensive list of raw materials, components and assemblies ...
  2. Manufacturing Resource Planning ...

    An integrated information system used by businesses. Manufacturing ...
  3. Materials Requirement Planning ...

    One of the first software based integrated information systems ...
  4. Enterprise Resource Planning - ...

    A process by which a company (often a manufacturer) manages and ...
  5. Kaizen

    A philosophy that sees improvement in productivity as a gradual ...
  6. Just In Time - JIT

    An inventory strategy companies employ to increase efficiency ...
Related Articles
  1. Fundamental Analysis

    Measuring Company Efficiency

    Three useful indicators for measuring a retail company's efficiency are its inventory turnaround times, its receivables and its collection period.
  2. Investing

    Choosing The Winners In The Click-And-Mortar Game

    E-tailing has changed the way consumers do nearly everything. Do you know how to pick the best retailer?
  3. Fundamental Analysis

    Vital Link: Manufacturing And Economic Recovery

    Manufacturing output is one of the clearest signs that an economy is recovering from a recession.
  4. Investing

    Doing More With Less: The Sales-Per-Employee Ratio

    If used properly, this ratio can give you insight into a company's productivity and financial health.
  5. Economics

    What Happens in a Make-or-Buy Decision?

    A make-or-buy decision happens when a company must choose to either manufacture an item itself, or buy it premade from a supplier.
  6. Fundamental Analysis

    Use Options Data To Predict Stock Market Direction

    Options market trading data can provide important insights about the direction of stocks and the overall market. Here’s how to track it.
  7. Economics

    Is the U.S. Economy Ready for Liftoff?

    The Fed continues to delay normalizing rates, citing inflation concerns and “global economic and financial developments” in explaining its rationale.
  8. Investing News

    Thursday Intel: Will Q4 Offer a Fresh Start?

    Investor hopes for a fresh start to the world economy in this quarter may be misplaced.
  9. Economics

    What's Economic Capital?

    While regulatory and economic capital use some of the same measurements of risk to determine how much capital a firm should hold in reserve, economic capital uses more realistic measures.
  10. Economics

    What is Economic Rent?

    Economic rent typically occurs when a product, service or property is in short supply, but demand is high.
  1. What are some of the drawbacks of industrialization?

    In economic history, industrialization is the social and economic transformation of the human group from an agrarian society ... Read Full Answer >>
  2. What is the difference between JIT (just in time) and CMI (customer managed inventory)?

    Just-in-time (JIT) inventory management focuses solely on the need to replenish inventory only when it is required, reducing ... Read Full Answer >>
  3. What economic indicators are important to consider when investing in the retail sector?

    The unemployment rate and Consumer Confidence Index (CCI) rank as two of the most important economic indicators to consider ... Read Full Answer >>
  4. How does the risk of investing in the industrial sector compare to the broader market?

    There is increased risk when investing in the industrial sector compared to the broader market due to high debt loads and ... Read Full Answer >>
  5. What challenges face infant industries?

    Infant industries are nascent industries in an economy, which many argue require protection and nurturing during their early ... Read Full Answer >>
  6. What option strategies can I use to earn additional income when investing in the ...

    Investors who are bullish on the industrial sector can use a covered call option strategy to earn additional income from ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Zero-Sum Game

    A situation in which one person’s gain is equivalent to another’s loss, so that the net change in wealth or benefit is zero. ...
  2. Capitalization Rate

    The rate of return on a real estate investment property based on the income that the property is expected to generate.
  3. Gross Profit

    A company's total revenue (equivalent to total sales) minus the cost of goods sold. Gross profit is the profit a company ...
  4. Revenue

    The amount of money that a company actually receives during a specific period, including discounts and deductions for returned ...
  5. Normal Profit

    An economic condition occurring when the difference between a firm’s total revenue and total cost is equal to zero.
  6. Operating Cost

    Expenses associated with the maintenance and administration of a business on a day-to-day basis.
Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!