asset-leverage

Vocabulary Word

Definition

'Asset-leverage' is when you use your existing goods or property ('assets') to gain advantage or make more money ('leverage'). It's like renting out a spare room in your house to earn extra income.

Examples in Different Contexts

In real estate, 'asset leverage' is the practice of using mortgage financing to purchase properties, thereby using less of one's own capital. A real estate investor might explain, 'Asset leverage allows us to expand our property portfolio more quickly, but it's important to manage debt levels carefully.'

Practice Scenarios

Operations

Scenario:

We need to improve efficiency with our existing production lines. How do we get more out of our facilities?

Response:

An effective way could be asset leverage; enhance the use of our manufacturing facilities to maximize output.

Tech

Scenario:

Our unique software holds a lot of potential. How can we exploit this to gain an edge over competitors?

Response:

We could leverage our software as an asset. Licensing it to other companies could create additional revenue streams.