Definition
- Managerial economies
- Managerial economies are savings from hiring specialist managers, each doing one job well, which a small firm cannot afford to employ.
Example
Can you think of an example of managerial economies?
A chain of two hundred shops employs a full-time buyer, a logistics manager and an accountant. The owner of a single shop does all three jobs herself.
Test yourself
Can you name five internal economies of scale?