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A
production facility requires a substantial commitment of financial
resources that will not be available for other key purposes:
developing market share, acquisition of new technology, or
personnel training.
Many
indicators of financial efficiency are a function of a measure
of activity divided by assets. For a given level of performance,
the lower the asset base, the higher the efficiency.
A
large investment in real property limits the firms flexibility
to reconfigure its operations vis a vis a rapidly changing
environment. Leasing key facilities affords your company such
flexibility.
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