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Significance and Measurement of Capacity Utilisation
Why is capacity utilization a critical factor for businesses in competitive markets?
Capacity utilization is critical in competitive markets because it determines a business's ability to meet customer demand, respond quickly to market changes, and maintain a competitive edge in terms of cost and delivery.
What are some methods or metrics used to measure capacity utilization?
Some methods or metrics used to measure capacity utilization include calculating the ratio of actual output to maximum capacity, analyzing machine or equipment utilization rates, assessing labor productivity or efficiency, monitoring production cycle times, and evaluating overall resource utilization.
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