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Product Costing Methods in Manufacturing

Product Costing Methods in Manufacturing
Product Costing Methods in Manufacturing that maximize profit

Regardless of business model or market segment, understanding cost structures has never been more important. In order to maximize profits, you need to be tracking the cost implications (which are often in flux) of designs, materials, manufacturing facilities and equipment, and much more at each stage of the product lifecycle across your entire portfolio. But, with today’s regulatory pressures, changing consumer preferences, complex product innovations, and intense global competition, achieving the best ROI from cost management efforts has never been trickier.

Typically, enterprise resource planning (ERP) systems do not provide sufficient support for a reliable cost analysis for each phase of product development. Without the right tools, product cost management is a tedious and decentralized function that can only be done once or twice per new product development and introduction (NPDI) cycle – severely limiting the windows of opportunity to identify product cost savings and maximize profits.

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Product Costing Methods in Manufacturing
Product Costing Methods in Manufacturing that maximize profit

Implementing Product Costing Methods that Work

Implementing Product Costing Methods that Work

Cost Estimation Accuracy

Even in the early stages, risk is an important consideration throughout the product lifecycle. Redesigns may be necessary multiple times, labor and raw materials fluctuate in price, or products launch but aren’t successful in the market. Since costs are designed into a product during early concept decisions, the implementation of cost-cutting measures at a later time is only possible with significant effort. How can you plan and control for costs accurately right at the beginning of the product development phase?

Cost Estimation Accuracy

Even in the early stages, risk is an important consideration throughout the product lifecycle. Redesigns may be necessary multiple times, labor and raw materials fluctuate in price, or products launch but aren’t successful in the market. Since costs are designed into a product during early concept decisions, the implementation of cost-cutting measures at a later time is only possible with significant effort. How can you plan and control for costs accurately right at the beginning of the product development phase?

Cost Management Tools for Maximizing Profit & Efficiency

Cost Management Tools for Maximizing Profit & Efficiency

Collaboration & Transparency

Standardized cost calculation methods support efficient costing processes and create accurate product cost transparency. But with different cost calculations for materials, machines, labor rates, etc. – all of which can vary by region – it can be challenging to make calculations transparent, track product costs systematically, and optimize accordingly. Without a detailed understanding of cost structures along the various stages of a supply chain, the profit will never reach its true potential.

In order to identify data-backed opportunities for profit maximization, you need tools that will provide detailed insight into product cost structures and manufacturing processes.

Collaboration & Transparency

Standardized cost calculation methods support efficient costing processes and create accurate product cost transparency. But with different cost calculations for materials, machines, labor rates, etc. – all of which can vary by region – it can be challenging to make calculations transparent, track product costs systematically, and optimize accordingly. Without a detailed understanding of cost structures along the various stages of a supply chain, the profit will never reach its true potential.

In order to identify data-backed opportunities for profit maximization, you need tools that will provide detailed insight into product cost structures and manufacturing processes.

Solutions

Profit Maximization for the Automotive and Transportation Industry

Automotive & Transportation

Product Cost Management

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Profit Maximization Industrial Machinery & Heavy Equipment

Industrial Machinery & Heavy Equipment

Product Cost Management

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Product Costing Methods for Electronics & Semiconductor

Electronics & Semiconductor

Product Cost Management

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Profit Maximization for the Medical Devices & Pharmaceuticals Industry

Medical Devices & Pharmaceuticals

Product Cost Management

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