The concept of leverage is very well evident in todays market.
All finacial services, media & entertainment sector and a host of other service industries operate on high operating leverage. The biggest component of the fixed cost is salary.
In good years this high OL has propeled their results, however in bad times like in 2008, these companies had no option but to cut fixed costs and reduce their break even points.
1 comment:
The concept of leverage is very well evident in todays market.
All finacial services, media & entertainment sector and a host of other service industries operate on high operating leverage. The biggest component of the fixed cost is salary.
In good years this high OL has propeled their results, however in bad times like in 2008, these companies had no option but to cut fixed costs and reduce their break even points.
Post a Comment