What are heavy assets and light assets?

Light assets: also known as light assets strategic model, refers to enterprises firmly grasping their core business and outsourcing non-core business. Light asset strategy is a value-driven capital strategy. Outsourcing product manufacturing and retail distribution, while focusing on design, development and marketing; Marketing mainly adopts celebrity endorsements and advertisements. The "light assets strategy" model can reduce the company's capital investment, especially a large number of fixed assets investment in the production field, thus improving the return on capital.

Characteristics of light asset strategy: asset scale tends to be small; Asset quality-tends to be good; Asset weight-tends to be light; Asset form-tends to be soft (intangible); Asset investment-tends to decrease; Asset value: static or dispersed-small, dynamic or comprehensive-large.

Advantages and disadvantages of light asset strategy: the advantages are reducing investment, improving efficiency, strengthening core competence, enhancing flexibility and reducing risks; Limitations: the excessive and absolute light asset strategy is a bubble economy (the quality of the bubble is the lightest).

Light asset company is mainly the intangible assets of enterprises, including enterprise experience, standardized process management, governance system, relationship resources with all parties, resource acquisition and integration ability, brand, human resources and corporate culture. So the core of light assets should be "virtual" things. These "virtual" assets occupy a lot of money and are light and flexible, so they are "light".