APPLICATION AREAS

Is your company sometimes also faced with technical changes to the effect that you cannot stay within your budgeted framework? If you start working with cost analyses based on full-cost accounting, you have already a lead of four steps over your competitors:

1. The more facts you have, the easier it is to control costs
2. You benefit from a sustainable transparency of targeted costs
3. Your purchasing department obtains target price orientation and arguments for negotiations
4. The effects of technical changes may be examined by cost simulation

Employ the detailed cost analysis, even in cases where only a few product details have been clearly defined. Initial assumptions with regard to parameters of material and production will provide you with a cost model in the early product stage, based on a technical foundation. Subsequently, you may fine-tune your cost analysis step by step.

Capitalise on the benefits of bottom-up-analyses as compared to the conventional top-down procedures!
Thereby, you will be informed about all cost factors at any time (materials, production processes, manufacturing parameters) and you will have knowledge of the essential details needed to stay within your budget allowance!

A cost analysis showing all workplace costs enables you to simulate different scenarios even prior to to start of production:

• Manufacturing technologies
• Volume fluctuations
• Site-related costs
• Shift plans
• Machine capacity utilisations
• Cost of maintenance
• Tooling costs
• Manufacturing overheads
• Long-term assessments with variable basic costs (energy, surface area, wages, etc.)

Your benefit?

Very simple: Lower manufacturing costs and competent decision guidance by detailed cost simulations.

You must achieve low purchase prices? You are in need of new bargaining arguments?
Lower your prices to the cost level from the very beginning by introducing a cost analysis. Thereby, you will control technical modifications and prevent inappropriate price increases.

Capitalise on six benefits of cost analysis for your purchases:

1. Strong points and facts for negotiations
2. Detailed target pricing
3. Easy creation of product-related quotation forms
4. Simulation and verification of supplier data (even during business negotiations)
5. Evaluation of technical product modifications even prior to starting negotiations
6. Utilisation of open-book accounting

Our experience has shown that a cost analysis, if cleverly tied into the negotiation, can break existing market prices.

You have conducted successful research and development work over several years, and now, close to starting production, you realise that the costs run out of control. You can no longer meet the budget allowance.

For the future you should rather forget cost estimates derived from the previous product version or based on vague assumptions! For an efficient design-to-cost process you need detailed facts and arguments. We recommend accurate cost analyses. Thus, you will dispose of properly investigated …

• Cost data for technical decisions
• Strong points for negotiations
• Cost simulations of technical options
• Selection support with manufacturing technologies

Utilise detailed cost analyses during your R&D process, enabling you to assess your costs on your own and to take the adequate technical decisions right from the beginning. Design-to-cost will help you to meet your budgets, including in the event of technical changes.

You deliver your products to other industrial enterprises? You have agreed on an open-book accounting to improve price transparency?

Start now to employ detailed cost analyses offering a variety of benefits, such as:

• High transparency of costs
• Cost simulation of technical changes
• Simplified elaboration of quotations

Transparent presentations of your quotations, achieved through cost analysis, will help you to build up customer confidence and to generate orders.

Do you wish to improve the success of your value-analysis projects?
Do you use prices or calculated production costs as a basis of your analyses?

Our experience has revealed that the data from detailed cost analyses yield better end results.

And this is why: A value analysis does not only tell you HOW MUCH something is costing, but also WHY it is costing this much. This proves helpful with all subsequent actions. Therefore, cost analysis based on full-cost accounting is the ideal principle for …

• Cost Benchmarking
• Cost-driver analyses
• Working costs analyses
• ABC analyses

The cost analysis provides you with all essential data and valuable indications for optimisation of product and cost.