Finding The Investment Sweet Spot
- Topics:
- Loss Mitigation
- Tags:
- Finance,
- Investment,
- LBL,
- Managerial Accounting,
- Return-on-investment,
- ROI,
- Roi/Tco
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Overview: The complicated relationship between investment and return for a location-based leisure facility (LBL) has been reduced to a simplistic formula that costs LBL owners profit and, sometimes, their businesses. There's a place called the "investment sweet spot," where one has spent not too much, and not too little, but just the right amount to reach the maximum return-on-investment and the secret is, the only way to hit that sweet spot is to focus on pleasing the guests. The sweet spot flies in the face of conventional wisdom, which says that the lower the development cost of a LBL, the greater the return on investment. The sweet spot flies in the face of conventional wisdom, which says that the lower the development cost of a LBL, the greater the return on investment. Real life is more complicated. Just as over-investment in a LBL decreases return-on-investment, so does under-investment. In fact, there is greater risk of failure with under- than over-investment.
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Format: HTML | Date: Jan 2001 | Pages: 1
