What is the specificity of assets?

the specificity of assets is the rate of specialized asset; The higher it is, the more difficult it is to convert the asset to another application. High specialization can also affect liquidity and business operations. Economists who study asset distribution, liquidity and related topics are interested in the specificity of asset, especially when the company relies strongly on highly specialized assets and has less flexible and more liquid assets.

It is possible for assets to specialize in multiple axes. For example, a company in a distant area can own a factory that would suit its needs. Thanks to this location, the asset is specialized because another company will probably not be able to use the equipment at this point due to distance from other sources of raw material protection and connections to transport nodes. The device itself can also be highly specialized, with the device and the layout suitable for the production of only one product.

One problem with the srsestedness of assets is that companies can be heavyto get rid of such assets. If they have cash flow problems, they cannot sell them to get money. In the case of bankruptcy or merger, it will also be difficult to get rid of specialized assets. This may also be a problem if the company changes processing, decides to re -focus the nature of its work, or has to adapt to the changing regulatory climate.

Another problem with the specificity of assets is that the company may have a difficult time to replace a specialized asset, especially for short -term and emergency situations. If the manufacturer has a specialized component production equipment and the problem is evolving, it may not be able to move production to another device. As a result, it could experience a shutdown. More flexible societies without a high degree of specificity of assets are not as vulnerable to problems as nature -plates or political unrest.

Companies may depend on specialized actsIvech and can enter the locked relationships with them because they cannot get rid of them. They carry risks, even if they can also carry benefits, for example, a more efficient way to achieve a very specific process. Companies considering buying or developing specialized assets can consider the risks and benefits to decide on the best choice for their needs. For a well -established company with a sufficient source of capital to be drawn in an emergency, the specificity of the assets may not be the main problem.