This question deals with the magnitude of the combined requirements to enter and/or maintain a position in the market. The answer depends partly on the magnitude of the capital needed for start-up and for operations and partly on other barriers to entry such as legal and regulatory barriers.

In some industries production requires a minimum magnitude of operation due to the manufacturing process itself or because of the need for economy of scale (a brewery, a car manufacturer, or a farming operation, for examples). In others, the legal and regulatory requirements are very demanding (food processing and pharmaceuticals for examples).

Additional consideration must be given the use of labor as compared with investment in fixed assets. Heavy investment in fixed assets usually implies a high level of requirement.