Ramp up is a term used in economics and business to describe an increase in a firm's production ahead of anticipated increases in product demand. Alternatively, ramp up describes the period from completed initial product development to maximum capacity utilization, characterized by product and process experimentation and improvements.
Ramp up is a significant increase in the level of output of a company's products or services. A ramp up typically occurs in anticipation of an imminent increase in demand. While it is generally a feature of smaller companies at an early stage of development, a ramp up can also be undertaken by large companies that are rolling out new products or expanding in new geographies.
A ramp up entails substantial outlays of capital expenditures and human resource expenses. For this reason, a company will generally only consider a ramp up once it has a reasonable degree of certainty about additional demand. Otherwise, if the anticipated demand does not materialize or is below projected levels, the company will be saddled with excess inventory and surplus capacity.