Capital Intensive: ‘Capital’ refers to the equipment, machinery, vehicles and so on that a business uses to make its product or service., Highly automated and to be used to produce on a large scale., Expensive to purchase and maintain equipment, Can increase output as can operate 24 hours a day, Quality can be standardised, Used to produce high quantities of identical items, Require a relatively high level of capital investment compared to the labour cost., Workers can be demotivated by repetitive nature of tasks, Labour Intensive: Long-term growth depends on being able to recruit sufficient suitable staff., Can create products to individual customer requirements, Require a relatively large workforce, More difficult to control quality as people are affected by tiredness, lack of motivation etc, Workers are deskilled, More likely to be used to produce individual or personalised products, or to produce on a small scale, ‘Labour’ refers to the people required to carry out a process in a business., Little capital outlay but need to spend heavily on recruitment and training,

Labour or Capital Intensive Production?

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