In many markets for personal services (such as shoe repair or lawn care)with low start-up costs,

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Economies of scale refer to the cost advantages that a business can achieve as its production increases. In markets for personal services with low start-up costs, the economies of scale are exhausted rapidly. This means that as the business grows, the cost per unit of production decreases up to a certain point. But beyond that point, the cost advantages diminish, and further expansion becomes less profitable. This happens quickly in such markets because the startup costs are low, and the market size is limited. So, there is no significant advantage for large-scale production, and the economies of scale are exhausted rapidly.

In Many Markets for Personal Services (Such as Shoe Repair