Conclusion

An awareness of cost fundamentals, cost analysis techniques, and innovative approaches to product costing is simply another area for the supply management and supply chain professional to master. Buyers and supply chain specialists involved with nonstandard, technically complex items must have the ability to evaluate a supplier’s cost structure and match supplier capabilities and product requirements from a cost perspective.

The ability to practice price and cost analysis techniques, such as those outlined in this chapter, can make the difference between creating value and creating waste.