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Overcapitalization in Business: Causes, Financial Risks, Warning Signs, and Smart Solutions for Businesses
Every business needs capital to operate, expand, and remain competitive. Capital gives a company the ability to buy assets, hire employees, fund innovation, and survive economic downturns. But while too little capital can cripple a business, too much capital can also create problems. This condition is known as overcapitalization. Overcapitalization occurs when a company holds…