There are two terms used for developing a project/factory: greenfield and brownfield.
What are the key differences between greenfield and brownfield?
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Greenfield
Greenfield means the development and construction of anything on previously underdeveloped land. The development project can be any project such as building a manufacturing facility, constructing a shopping mall or even a housing scheme.
In simple words, a Greenfield project means the development of a new project from scratch on undeveloped land.
The land which is used for such purposes can be agricultural land, a previously undeveloped urban open area or just an open space.
To illustrate further with an example, for example, an automaker wants to spearhead in Nigeria by building a new auto plant. So this should be considered a Greenfield project as the company will acquire a huge land and the start of building a plant from scratch.
Brownfield
Brownfield developments are usually the development projects which are built on land which was used before, for instance, for industrial, commercial or residential purposes.
Brownfield is also used for projects when the existing plant or project is going through expansions. For instance, a company is investing more money to install new machinery to double the production capacity of its existing plant.
The key differences between the Greenfield and Brownfield can be illustrated from the following table.