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The Activity-Based Costing (ABC) modeling system measures the true economic costs to manufacture, warehouse, distribute, market, and sell a particular product or service.  The modeling system is flexible and powerful enough to perform evaluations at all levels of production execution - by facility, production line, specific equipment, and process - as well as the aggregation at any and all of these levels.   Each of the relevant processes is modeled discretely in order to identify and measure the statistically-significant drivers of cost content.  Direct labor, indirect labor, supervisory labor, overhead labor, raw material usage, primary & secondary packaging, wastage, spoilage, utilities, production supplies, maintenance/repair labor & materials, and material handling and storage are precisely measured at every relevant activity throughout the production cycle.  Post-production activities such as internal transport, warehousing, and shipping are modeled discretely by product, customer, and distribution channel, as well as in aggregate totals.  Sales and marketing activities, are also modeled at a similar level of detail and statistical accuracy, based upon the specifics of your company’s sales & marketing programs and channels, and incorporated into the ABC modeling system, thereby presenting a comprehensive, accurate, and integrated cost and profitability evaluation tool for your use in optimizing pricing, process, channel, SKU rationalization, and new product introduction decisions for your company.

Activity-Based Costing Model