Overview of Cost Advantage Strategy
Surprisingly, not all manufacturers know the true cost of their products. Without this knowledge, they incorrectly quote jobs or price products that will not to achieve the profit margins they want. Without detailed knowledge of the full costs of each work center, including overhead allocations, manufacturers won’t achieve targeted margins and long term profitability.
The DVIRC Difference
DVIRC’s costing experts will fully analyze your cost of doing business (Income Statement) to provide the simplest and most accurate approach to quoting opportunities. We calculate fully loaded labor rates by work center, equipment overhead based on replacement value, and allocate overhead costs with great accuracy. We then test our approach against current practices and discuss the basis for any differences.
We provide a solid foundation of cost information that can be used when price negotiations will not allow your company to achieve preferred profit margins. Our results simplify the quoting and pricing calculation, and our approach to calculating fully-loaded work center rates is the most comprehensive analysis in our marketplace.
Benefits of Costing for Competitiveness
DVIRC clients benefit from a “fresh look” at their quoting/costing practices based on our experience at over 125 companies over the last 20 years. The awareness of proper costing/overhead allocations on job/product pricing allow our clients to make the best possible decisions about when to take work or how to strategically price products in their marketplaces.