Alpha Incorporated and Beta Company are sheet metal processors that supply component parts for consumer...
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Alpha Incorporated and Beta Company are sheet metal processors that supply component parts for consumer product manufacturers. Alpha has been in business since 1985 and is operating in its original plant facilities. Much of its equipment was acquired in the 80s and 90s. Beta Company was started two years ago and acquired its building and equipment then. Each firm has about the same sales revenue, and material and labor costs are about the same for each firm.
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What would you expect Alpha's ROI to be relative to the ROI of Beta Company?
What are the implications of this ROI difference for a firm seeking to enter an established industry?
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