What is meant by Capacity on demand (COD)?

Definition of Capacity on demand (COD)

Capacity on demand (COD) is a novel concept in service and capacity delivery through vendors .This trend allows buyers to purchase only some portion of the on-hand capacity, this trend is becoming the most desirable service due to its swift, cost-saving and functional modes especially in the information technology industry.

Brief Description of Capacity on demand (COD)

Capacity on demand (COD) is a purchasing facility that allows companies to purchase equipment with more digital processing, storage, or other options other than the company’s on the spot requirement. This extra capacity remain intact and unpaid, until the company use it. Capacity on demand is a lucrative and time-saving substitute to conventional improvement. With COD, a vendor might provide a company with high tech equipment but only charge the company for the number of devices that are currently being used. The additional capacity is provided to bind the user to use the capacity from the same vendor whenever it is needed in the future. The expediency of capacity on demand depends on a careful formulation of a rational agreement or contract between the vendor and the purchaser.