Factors affecting fixed capital requirements of a company:

(i) Nature of basis: A manufacturing concern requires more fixed capital to purchase fixed assets e.g. plants and machinery, etc. as compared to a trading concern.

(ii) Scale of operations: A larger organisation operating at a higher scale needs bigger plants, more space, etc. and therefore requires more fixed capital as compared to small organisations.

(iii) Choice of technique: The business organisations using capital intensive techniques require more fixed capital whereas companies using labour-intensive techniques less capital.

(iv) Technology upgradation: Industries in which technology upgradation is fast need more amount of fixed capital as when new technology is invented, old machines become obsolete and they need to buy new plants and machinery whereas companies where technological upgradation is slow they require less fixed capital as they can manage with old machines.

(v) Growth prospects: Companies which are expanding and have high growth plan require more fixed capital, to invest in more plants and machinery and other fixed assets in comparison to the companies having slow growth track or less growth prospects.