Should Cost Analysis

Should costing, Identify margins, Supplier alternatives

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Written by Fabian Hassel
Updated over a week ago

Introduction

Typically, before teams start to work with the Should Cost Analysis, Makersite has already conducted an implementation project. This has included the integration of organization specific suppliers.

During the integration project the purchased materials, suppliers and prices of an organization are imported into Makersite and are enriched with Makersite's information about material and product supply chains.

Should Cost Analysis Overview

There are four simple steps to a Should Cost Analysis: 

  1. Open the should cost model from the DPM

  2. Identify the should cost and identify margins

  3. Find alternative suppliers in the supplier finder app.

We will conduct a should cost analysis of a “Ball Pen” and 

  1. Identify the biggest cost driver

  2. Identify where the biggest saving potential is located

  3. Visualize the supplier map

Perform Should Cost Analysis

  1. Import the 'Ball Pen' BOM. If this tutorial has been completed already, skip to Step 2, if not please follow the Import a BOM tutorial in the Makersite FAQ pages.

  2. From the Importer page, select 'Open DPM', or if the BOM is already imported, open the Ball Pen Product Group from the Search Bar, and then click on the app drop-down and choose the 'Dynamic Performance Model' app from the 'Business' heading.

    From the DPM (Dynamic Performance Model) page click on the cost tile to open the should cost grid.

Results are: 

Task 1: Ink Chamber

Task 2: 99.8% saving potential of the Ink 

Note: Both results are based on fictive sample data and might vary from user to user. 

3. To now identify alternative suppliers for the ink, we can shift now to the supplier map by changing the app to “supplier finder”

You can change the views depending on your requirements and your wishes in the app menu.


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