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What is Capacity Planning and Best Operating Level about?
Strategic capacity planning determines the overall capacity level of capital-intensive resources like facilities and equipment. Capacity used is the actual output rate achieved, while best operating level is the designed capacity that minimizes costs. Capacity planning establishes the needed output rate by considering demand forecasts and purchasing capacity in increments. The best operating level balances economies of scale with avoiding diseconomies from congestion or complexity. Capacity decisions are ma
- Author
- Suneel Kumar Meena
- Language
- EN