Keeping an eye on target costs with FACTON EPC

Target cost tracking with FACTON EPC provides businesses with the transparency they need to achieve their goals as any target cost gaps are quickly identified.

Target costing is used to determine a competitive yet hypothetical sales price of newly developed products based on market research and product properties. To achieve a profit, the target costs must be below the total expenses incurred in development and construction, while all steps of the process such as work preparation must be taken into account. 

 

FACTON EPC allows for the assignment of target costs to individual functions, assemblies, or components. Any deviations are visualised by the software. The margins to be achieved in specific functional areas or by individual assemblies can thus be continuously optimised.

 

Assigning target costs – identifying and eliminating deviations

The costing software allows for the allocation of targets, or more specifically, target costs, to any element at any BoM level. It is even possible to set different targets to be met over the duration of a project. Absolute target costs can be entered manually. Deviations from these targets are clearly highlighted with traffic colour codes (green, orange, red). 

 

Linear target costing is a method that assists users with automatically generated target cost figures. With this approach, the cost elements are assigned a certain share of the target cost reduction (top-down approach). This process can be repeated as many times as required until all targets necessary to achieve a profit are set. 

 

Both the manual and the automated approach allow for: 

 

  • recording and assignment of targets
  • visualisation of target cost gaps 
  • identification of cost-saving potentials 
  • easy development and management of solutions to achieve the set target costs 
  • control of cost target across entire project