Internal Economies of Scale

This refers to the economic benefits achieved within larger organisations compared to those available to smaller ones.

Internal Economies of Scale may include Purchasing (achieved through bulk buying), Technical (the ability to purchase and operate more expensive or specialist equipment), Managerial (for example through the use of specialist managers in areas such as HR, ICT, Marketing etc), Financial (through access to a wider range of financing options or better interest rates for larger investments), Risk (larger reserves typically support the business during a downturn, whilst the opportunity for a wider and diverse product range reduce the risk of failure in specific markets).

Internal Economies of Scale is a term normally found in economics and financial management; Explore our learning zone to discover more