Top 14 Disadvantages of Large Scale Production

1. Too Large:

The most obvious disadvantage is that as the size of business units expands beyond certain points, it becomes too unwieldy for its managers to mange. As the concerns becomes large, supervision becomes ineffective and wastage becomes more rampant.

2. Production Not According to Individual Tastes:

There is no fineness or perfection in the commodity. As they merely turn out certain standardized goods they are unable to satisfy the individual tastes of the consumers. They also lose contacts with consumers.

3. No Personal Contacts:

This lacks personal contact between the employers and employees. This may lead to friction, misunderstanding, disputes and strikes in large units.

4. Not Flexible:

The large scale production cannot easily be adopted itself to the changing circumstances. As a result it submits itself to the disadvantages of such changes.

5. Monopoly:

As a result of large scale production, there always exists the fear of monopoly. It can either be through wiping out small scale producers, through competition or by joining hands with others and driving other producers out of the market. This leads to an increase in prices and fall in the quality of the product.

6. Over-Production:

In the large scale production demand cannot be assessed accurately which leads either to overproduction or underproduction.

7. Evils of Factory System:

Usually, large scale production is always associated with all the evils of factory system like density, pollution etc.

8. Unequal Distribution of Wealth:

Large scale production leads to unequal distribution of wealth in a country. A big portion of wealth is concentrated in the hands of mill owners. This creates unrest in the society. Thus, it spoils the social atmosphere of the society.

9. Heavy loss and Dislocation:

The breakdown of large scale industries may lead to inflict loss and heavy burden and dislocation of the economy.

10. Industrial Disputes:

The large scale production lose direct relationship with their employees. This leads to discord and conflicts between owners as well workers. Result is the strikes, lockout etc. In turn, they adversely affect the production.

11. War:

Under large scale production, producer makes efforts to sell their products in foreign markets. Tension is created among different countries to capture these markets. This leads to the break out the war.

12. Decline of Cottage and Small Scale Industries:

Large scale production reduces the cost of production. Goods are cheap. This leads to decline of cottage and small scale industries as goods produced by them are costly.

13. Adverse Effect on Labourers:

Generally labourers become more dependent. This gives birth to laziness. As a result, they are exploited and their physical and mental development is retarded.

14. Birth of Capitalism.

Large scale production is in the hands of capitalists rather than Government. Many evils breed. In essence, large scale production has both advantages and disadvantages. If the capitalists adopt a progressive attitude or the government undertakes the production itself, the disadvantages can be avoided. Large scale production is very essential for the economic development of the country.

Submitted by : Professor Zion, Category : Production