Capital Intensive vs Labour Intensive free essay sample

Management initiatives for the Agri-business sector in India Topic: Capital intensive vs. labour intensive in agri-business Abstract The presentation attempts at reviewing the management initiatives for capital and labour intensives in agri-business in India. Agriculture has played a vital role in the survival of human and development of civilization. Agriculture continues to be a fundamental instrument for sustainable development in India. Agri-business is a generic term for the various businesses involved in food production, including farming and contract farming, seed supply, agrichemicals, farm machinery, wholesale and distribution, processing, marketing and retail sales. The primary objective of this presentation is to find out the capital intensive vs. labour intensive in agri-business in India. The secondary objective is to find out in what circumstances both these intensives are going to be used effectively and efficiently. Agri-business can be done in two forms of utilisation of sources to effective mass produce. One is Capital intensive and the other is Labour intensive. We will write a custom essay sample on Capital Intensive vs Labour Intensive or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page ‘Capital’ refers to the equipment, machinery, vehicles, etc. , that a business uses to make its product or services. Capital-intensive processes are those that require a relatively various levels of capital investment compared to the labour cost. The costs of financing, maintaining and depreciating of capital are investment and overheads. These processes are highly automated in related areas and mostly used in large scale. These processes are costly and minimum time consumption to increase the scale of production. ‘Labour’ refers to the people required to carry out a process in a agri-business. Labour-intensive processes are those that require a relatively high level of recurring labour compared to capital investment. This process is mainly used in small or medium scale. The labour cost includes wages, recruitment, training, other benefits, etc. This process mainly used to produce an individualised or personalised products. In conclusion, Capital intensive agri-business involves in high level of fixed cost with higher risk. Risks may be in a form of depreciation of the equipment, consumption of high power etc. The degree of capital intensity is easy to measure in the ratio of the total money value of capital equipment to the total potential output. Labour intensive in agri-business involves in various level of variable cost with some risks. Risks are in the form of delay in transportation of goods, non-availability of skilled labours in case of large scale farm, etc. The degree of labour intensity is measured in proportion to the amount of skilled and unskilled labours required to cultivate for produces or other services. The presentation recommended that both the intensives should be used according to their needs and necessity in agri-business. Keywords: Capital-intensive, Labour-intensive, fixed cost, variable cost