There are three main types of capacity in manufacturing:
1. Design capacity — the maximum possible output a manufacturing plant can produce based on its design specifications, assuming that all resources are being used optimally and without constraints
2. Effective capacity — the actual production capacity that a manufacturing plant can achieve, considering practical limitations such as machine downtime, labor availability, and raw material availability
3. Rated capacity — the production capacity that a manufacturing plant is marketed or rated to produce, usually less than the design capacity and may reflect the expected effective capacity under normal operating conditions
Each of these types of capacity plays a different role in capacity planning and management, and it is important to understand the differences to plan and optimize production effectively. By evaluating and managing these different types of capacity, manufacturers can ensure that they have the resources and capabilities needed to meet the demand for their products.