Consulting - Activity-based Product Cost Management

Traditional cost accounting management methods are no longer suitable for today's evolution towards flexible, automated, and lean manufacturing. Some companies, operating under traditional cost management thinking, find themselves in a dilemma where they can't get large orders and can't make a profit on small orders.

Work-based cost management estimates costs based on the resources and activities used at different work levels. This approach is closer to the actual situation on-site and is more conducive to making decisions on various investments, pricing, or improvements.

In the past, when information technology was underdeveloped, it was difficult to directly trace the actual data of the production process in operation-based cost management. Today, with advanced information technology, it is possible to instantly and accurately grasp data such as which equipment and resources are used, how long they are used, the quantity produced, and the quality status, allowing for the calculation and analysis of operating costs. Industry 4.0, in particular, enables companies to instantly grasp the unit cost of each batch of production.

 

It assists enterprises in implementing a product-based cost management mechanism, which includes product cost analysis, product price management, production cost control and improvement, and the basic establishment of zero-based budgeting. This enables enterprises to effectively utilize resources, maintain low-cost operations by combining lean production, and ensure profits.

 

 

Please contact our company for more information.