2 ms·
You don't always have the choice to delay. Sometimes the sublinear cost is associated with something you really need to do. Examples of sublinear costs: - Whe
by abeppu 6y ago
You don't always have the choice to delay. Sometimes the sublinear cost is associated with something you really need to do.
Examples of sublinear costs:
- When you pay lower per-unit price by ordering large lots. But you can't just wait a long time and be able to afford a giant order; your first small orders may help you generate revenue that let you buy the later big orders.
- When your team is young perhaps you need 1 new laptop per new hire. A few years later, you need < 1 new laptop per new hire b/c some receive recycled laptops from departed employees. But you can't wait 3 years and then hire 100 people and 80 laptops.
- You're growing some infrastructure which serves/covers some territory. At first, all new customers are in new territory; the ratio of new infrastructure to new customers is high. Later, some portion of new customers are covered by existing infrastructure, and that portion grows over time. But even if you could afford to build everything at once, you may not know where to build most of it until you have a bunch of customers.
- I don't really know if this one is true, but a whole industry seems to believe that a burst of advertising effort all at once is more effective than a marginally greater volume of advertising spread over a longer period. But you can't do zero advertising for 5 years and then take over time square.