Advanced Cost Modelling

In the old days, the typical negotiation technique was:

“This is too expensive - I demand a lower price!”

Instead, we should investigate:

"What should this item or service really cost?”

This is where cost modelling comes in. Using advanced cost modelling techniques, we analyse all the cost elements and drivers that go to make up the finished price: raw materials, packaging, energy, labour, overheads, sales & marketing…

Every scenario is different but as examples of where value may lie:

• Materials – switching from spec A to spec B or changing from origin X to Y

• Waste – collaborative efficiency programmes

• Packaging – reducing colours or down-weighting

• Logistics – optimised load configuration and routing

• Excess Supplier Profit – constructive challenge if the supplier is taking the micky

Advanced cost modelling is my A-Star expertise. I’ve used it to deliver incredible value for many clients from SMEs to multi-nationals:

• Millions GBP cost-out savings programmes

• Total reconfiguration of end-to-end supply chains

• Unearthing of major quality risks derived from forensic costing

• Commercial mechanisms that underpin long-term strategic partnerships

• Analytics to inform insource/outsource decisions

• Cost insights to inform supply security

If you don’t know the cost structure of your materials, products or services you’re buying, it’s likely you’ll both be missing out on lashings of value and have major risks too.

Contact me and we’ll sort this out