Minimum efficient scale

Minimum efficient scale (MES) is like a target goal that a company should reach. It's the minimum amount that a company needs to produce in order to use the best resources and reach the most efficiency.
Imagine if you wanted to bake a cake. The minimum efficient scale would be the amount of ingredients and tools needed to make a really good cake. So you need to have the right ingredients, the right tools, and a certain number of them, so that you can make a really good cake.

In the same way, companies need to reach MES in order to make the most efficient use of their resources and make the best products. For example, a company needs to have a certain amount of workers and equipment to make their products at the highest quality and most efficient rate. If the company does not reach MES, it will take longer and be harder for them to make their products or services, and this means lower quality or higher prices for the customer.