Costing

Confused about all the different ways to determine the real cost of running your business? You won't be after our specialists help you find and fix the costs in your business.

Manufacturing is not only intensely competitive, it's become extremely complicated. Customers demand higher quality at lower price, and they have many choices about where and how to get what they want. To stay ahead of competition and keep your company in the black, you need to manage your costs closely and proactively.

There are several different ways of determining the costs you need to know:

Standard Product Costing, based on bill of material (BOM) and labor cost for the product specific work time. Uses indirect costs as multiplier of direct costs. Uses standard cost as an average target product cost and compares with actual cost calculated similarly. Calculate using the following:

- Labor
- Material
- Overhead

New Product Estimate, using cost factors associated with the complete business process for introducing new products or product models to market: early concept design through development, manufacturing planning, procurement sourcing, pilot production to full production, and delivery after product launch. Calculate using the following:

- Material
- Direct labor
- Direct overhead
- Tooling
- Target cost

Equipment Purchase and Feasibility Study, which answers one main question: Will the idea work, and should you proceed with it? Calculate using the following

- Volume
- Product cost
- Target cost

Breakeven Analysis, which determines how many units you must sell to recover your cost, before you start making a profit. Examines many interdependent cost variables to produce accurate estimates, including

- Selling price per unit
- Total fixed costs
- Variable unit cost
- Total variable cost
- Forecasted net profit

Make vs. Buy Analysis, which examines standard cost per unit and determines whether to outsource or manufacture in house.