capital intensive


Capital Intensive

Describing a company or industry requiring a great deal of capital to maintain operations. For example, the automobile industry is capital-intensive because, in order to make cars, it requires a lot of workers and expensive equipment that must be properly maintained. Another, smaller scale example is a dentist office, which requires expensive equipment and materials. In order to stay afloat, capital intensive companies need either consistently large profits or inexpensive credit.

capital intensive

Of or relating to a firm or industry that requires large amounts of fixed assets and/or cash to operate. Steel, automobile manufacturing, and mining are capital intensive industries.