What Are The Cost Drivers

Firms that manage their drivers better can offer lower prices or higher quality. How to Analyze Your Cost Drivers

Cost drivers are generally classified based on how they impact the business structure and operations: what are the cost drivers

Recognizing these factors is not just an accounting exercise; it is a strategic necessity. Firms that manage their drivers better can offer

You cannot manage what you do not measure. If your logistics costs are rising, you might instinctively try to negotiate cheaper shipping rates. However, if the true cost driver is "number of partial shipments" due to poor inventory planning, cheaper shipping won't solve the problem. You must fix the inventory planning (the driver) to fix the cost. If your logistics costs are rising, you might

You can pinpoint "non-value-added" activities that drive costs without helping the customer.

What are you in? (e.g., manufacturing, SaaS, retail)