Why manufacturing businesses should not overlook product costing?

If we ask you what is product costing, chances are you will say, “it’s just the setting up of a price for products.” But it is more than that. It is an important step in determining the right price for a certain product so as to make a well-informed decision regarding the business.  

Knowing and understanding product costing can help your business in multitude of ways like: 

• Making purchase decisions: 

Selling a product at the wrong price can have a grave impact on the profitability of your business. Furthermore, if you implement the technique of selling your product at a lower rate than your competitors, then this won’t let you stay long in the competition. Hence, it is important to invest in Acumatica ERP software that quickly captures the data. Thus, faster computation helps you make a well-informed decision regarding purchasing.  

• Real-time project tracking: 

Acumatica ERP integrated with product costing features will help determine the cash flow. Thus you will know if the money that is being put in every process of the project is being properly utilized or not. Therefore, with a proper product costing system in place, you will be able to assign costs to various stages of the process with greater accuracy. 

• Business decision: 

There is no surprise in the fact that the decisions of the businesses revolve around the return of investment and how much profit is the business going to make. Product costing can make a huge difference in the business. Take, for instance, a manager who makes use of absorption costing may not realize that how the specific pricing contracts can add value to the decision. But with Acumatica ERP integrated with product costing, you can leverage variable costs. This can thus add to the profit.  

• Selling an intermediate product: 

Intermediate products are the products that are formed in the process. They are also used to manufacture the final products. Take, for instance, salt and sugar, both of which can be used as final goods but can also be used to make another finished product. Product costing can prove pivotal in the processing or selling of intermediate goods. The automated processes and analytics can help a business make an intelligent choice with the tools. This will thus simplify their financial operation.  

• Development of the project: 

Product costing can prove to be an invaluable resource in the development of the project. It will empower you with the ability to create and strengthen a highly accurate manufacturing process. Acumatica ERP integrated with product costing will help you assign a cost to the materials, features, and characteristics. This will thus help you make well-informed decisions with the cost predictions.  

Our Acu Process manufacturing system comes well-equipped with the tools and technology. It will help you keep a tab on the changing product cost. From labor, raw material, consumables, material cost, overhead cost, our implementation will track every minute cost that will impact the decisions you take for your business.  

Reach out to Tayana Solutions experts, today!