The capacity utilisation of many companies is not aximised, the Marketing Director, Cadbury Nigeria Plc, Dele Anifowoshe has said.
Speaking with The Nation, he said this impacts negatively on the profits of organisations and forces price increases. It also affects the shareholders value and workers.
Anifowoshe said when manufacturers are producing below their installed capacity, it affects organisations. He therefore stressed the need to boost capacity utilisation.
He said if a company or sector is able to employ its capacity fully, prices would fall as production would be maximised, and use of resources will drive production, reduce manufacturing costs as fixed and variable costs are then spread over a maximum volume that companies could produce.
"If industries are not able to deliver maximally, that means revenue yield to the government will be low because excise duty is dependent on what the companies produce. It will impact on yield from income tax and , therefore, revenue accruing from that will be affected and of course aggregate demand will also fall. When there is pressure on disposable income of consumers demand then drops and when that happens it indirectly affects industries because they will also need to further cut down on production," he explained.
The Founder/Chairman, Sam Ohuabunwa Foundation of Economic Empowerment (SOFEE), Mazi Sam Ohuabunwa, said good quality would make indigenous products to go places, adding that this would further expand the nation's economic base.
He said one of the things that make businesses to thrive is their quality and that lack of infrastructure and appropriate managerial competence has contributed to business failures.
He regretted that many firms had collapsed because of lack of infrastructure. This, he said, has affected the rate of investments.
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