Product Costing

Make smarter product costing decisions early in the lifecycle

Even for cost estimates throughout the early phases of product development, many businesses still use standalone databases and spreadsheets. In the early stages of product development, enterprise resource planning (ERP) systems typically do not offer enough assistance for a trustworthy cost analysis.

Teamcenter® product costing offers an enterprise-wide platform for organising calculations and centrally storing the business’ in-house costing knowledge. Additionally, Teamcenter Product Costing enables data sharing between ERP and Product Lifecycle Management (PLM). The methodology of the traditional bottom-up overhead computation is used in product costing. This strategy establishes the material utilisation and process costs based on a thorough understanding of the product structure. The calculations are based on up-to-date benchmark data for manufacturing technology, equipment, supplies, and labour prices globally. To maximise the benefits, several departments, including cost engineering, buying, controlling, and sales, can collaborate via Teamcenter.

Product Costing Enables You to Make Smarter Decisions Early in the Lifecycle. Read More Below.

Design-to-Cost

In Teamcenter product costing, you may depict the whole pricing structure of your goods, and cost engineers can view the effects of changes linked to development on the price at any moment. Early in the development phase, you can pinpoint the cost-drivers and provide other remedies. You may also recreate other production situations using the cost simulation tools included in Teamcenter product costing, such as a comparison of manufacturing technologies.

Profitability Calculation

Executives may protect product investments by forecasting future unit costs and pricing over the course of the whole product lifetime using the profitability calculation. You may offer the foundation for pertinent metrics, such as internal rate of return, net present value, and payback durations, by visibly decomposing yearly expenses, revenues, and cash flows. You may evaluate the profitability of your projects and contrast them to find the optimal investments using the discounted cash-flow computation.

Purchase Price Analysis

As a buyer or procurement officer, you may conduct accurate cost analyses of supplier components on various commodities using the purchase price analysis integrated with Teamcenter product costing (“shadow calculations”). You may use Teamcenter product costing to assist in value engineering and cost structure negotiations with suppliers. These cost projections allow you to bargain for future target pricing or buy prices based on accurate cost information. You can implement an open-book policy if you’d like.

Quotation Costing

Teamcenter Product Costing helps organisations respond to requests for quotes more quickly and accurately, boosting their chances of winning new business. It facilitates negotiations with your clients by providing “optimised but understandable” cost data in tailored formats. In open-book discussions with the customer’s cost specialists, you may utilise and explain this data to determine your pricing. You have a stronger bargaining position in cost talks if you show a clear cost structure and a credible breakdown of the product expenses.

Target Costing

In the initial stages of preliminary costing and target costing, cost engineers can utilise Teamcenter product costing to calculate product cost. Complex assemblies and versions may be rapidly and precisely calculated. Based on the bills of materials and bills of process, the full pricing structure for your items and variations may be duplicated. Additionally, you may calculate and categorise direct expenses and overheads, manufacturing procedures and steps, and process and material factors.