Are you a manufacturer? Are you absolutely certain?
In my mind I don’t care if you make widgets, silk screen t-shirts, or prepare sandwiches; if you do any of these things or something similar, you are a manufacturer and you need to run your business off of an efficient cost model.
In an efficient cost model, forces the need to know these things before you truly get started so you can price your product correctly to ensure profitability and minimize failure.
- Material cost
- Prep cost
- Admin cost
- Waste
These items happen in any and all manufacturing environments. These are your costs of goods and services. These are the costs of keeping your machines and physical space moving and covered.
You need to know costs and how they will increase with incremental changes up and down in production.
We prepare tax returns and financial reports. We need to follow these methodologies as well.
So back to the questions, are you a manufacturer? I know I am.