ABSTRACT
Imagine that you have just introduced a new product into the marketplace. How would your Vice President respond if its cost were 10% below plan? She probably wouldn’t say much because you have a good team that works hard to control cost and she expects this level of cost control from you. How would your Vice President respond if your cost at introduction was 20% below plan? She would probably be interested and ask you how you did it, but little more would come of it. But how would your Vice President respond if your cost was 30% below plan? She would most likely be very interested and ask how you did it so she could apply your methodology to every product in her division. This is how Target Costing gets started in some firms. Target Costing is the approach that is helping many firms achieve costs significantly lower than they have in the past. Target Costing has been shown to consistently reduce product costs by up to 20-40%, depending on your circumstances. Through the text and the Exercise, this book presents a proven approach to achieving competitive product cost applicable to a variety of industries. This quick-read book provides users practical Target Costing tools and methods that achieve significant cost savings for their firms.
