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What is a Joint Product?

Malcolm Tatum
Malcolm Tatum
Malcolm Tatum
Malcolm Tatum

Joint products are two or more products that are produced at the same time by using the same basic manufacturing process as well as the same essential raw materials in that production process. Essentially, the products follow the same manufacturing or refining process up to a certain point, when they branch off and are finally finished into two or more distinct products. The process of joint product manufacturing is common in a number of industries, with the petroleum and the food industry being two examples.

One of the main benefits of a joint product approach is that a company can manufacture a wider range of goods without incurring the expenses related to operating multiple manufacturing platforms. Since the same basic raw materials and the same production machinery is used for the majority of the processing of those materials, the company can often minimize waste while also increasing the output each production hour. Both time and money is saved since it is possible to produce multiple products using the same processes and even the same processing facilities. This in turn means a lower cost per produced unit, which allows the company to offer those units for sale at highly competitive prices.

Dairy items such as cheese and butter can be joint products.
Dairy items such as cheese and butter can be joint products.

With petroleum products, the joint product approach makes it possible to simultaneously produce goods such as gasoline, different types of oil, and kerosene using many of the same production techniques and facilities. Eventually, each joint product reaches what is known as the split-off point, which is essentially the point in the production process where the petroleum based products each move off into separate processes that result in the refinement of those products into their final form. Since so much of the production process was the same for all the products, the manufacturer is able to produce greater quantities to meet the demand for each of those products.

Kerosene is a product of crude oil distillation.
Kerosene is a product of crude oil distillation.

A similar approach can be found in the food industry. The joint product approach is often used when it comes to producing dairy products for consumption by the general public. Along with refining milk for sale, a manufacturer can also simultaneously produce cream, cheese, and butter as part of the overall process, making it possible to market several different dairy products produced using the same facilities. As with oil products, the end result is the ability to produce these related products faster, allowing the manufacturer to save money while still keeping up with consumer demand.

Malcolm Tatum
Malcolm Tatum

After many years in the teleconferencing industry, Michael decided to embrace his passion for trivia, research, and writing by becoming a full-time freelance writer. Since then, he has contributed articles to a variety of print and online publications, including WiseGEEK, and his work has also appeared in poetry collections, devotional anthologies, and several newspapers. Malcolm’s other interests include collecting vinyl records, minor league baseball, and cycling.

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Malcolm Tatum
Malcolm Tatum

After many years in the teleconferencing industry, Michael decided to embrace his passion for trivia, research, and writing by becoming a full-time freelance writer. Since then, he has contributed articles to a variety of print and online publications, including WiseGEEK, and his work has also appeared in poetry collections, devotional anthologies, and several newspapers. Malcolm’s other interests include collecting vinyl records, minor league baseball, and cycling.

Learn more...

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    • Dairy items such as cheese and butter can be joint products.
      By: lidante
      Dairy items such as cheese and butter can be joint products.
    • Kerosene is a product of crude oil distillation.
      By: Gino Santa Maria
      Kerosene is a product of crude oil distillation.