In ProdSys, calculation is a critical component of managing costs and pricing throughout your business processes. Each calculation is specified at the article level, meaning that every item or piece of equipment has its own detailed cost structure. The total cost on an order line is the sum of all the articles used on that specific line, providing a comprehensive view of expenses associated with a particular order.
How Calculations Work in ProdSys
Calculations in ProdSys are built around a simple yet effective concept: every article or piece of equipment that is part of an order is individually calculated, and these individual costs are then aggregated to determine the total cost for each order line. This approach provides a precise and transparent way to manage and understand the costs associated with each product or service offered by your business.
Pre-Calculation and Post-Calculation in ProdSys
ProdSys utilizes two types of calculations for every order:
Pre-Calculation: This is the initial cost estimate made when the order is created. It provides an overview of the expected costs, based on the articles and equipment included in the order. The pre-calculation is based on the standard costs, prices, and resource usage specified in the system before production begins.
Post-Calculation: This calculation is performed after the order has been produced or completed. The post-calculation takes into account the actual costs incurred during production, including any variances in material usage, labor time, or other expenses that may have occurred.
Benefits of Pre-Calculation and Post-Calculation
Improved Cost Control: By having both a pre-calculation and a post-calculation, ProdSys allows businesses to compare estimated costs against actual costs, helping identify discrepancies and areas for improvement.
Enhanced Profitability Analysis: The comparison between pre-calculation and post-calculation provides valuable insights into the profitability of each order. Businesses can analyze which products or services are most profitable and adjust pricing strategies accordingly.
Accurate Pricing: The detailed breakdown of costs for each article ensures that pricing is accurate and reflects the true cost of production. This helps prevent underpricing and ensures that all expenses are covered, contributing to overall profitability.
Better Decision-Making: Having a clear view of both estimated and actual costs helps businesses make informed decisions regarding production processes, resource allocation, and pricing strategies. This data-driven approach leads to more effective management and planning.
Efficient Resource Management: By understanding the cost structure at the article level, businesses can better manage their resources, optimize inventory levels, and reduce waste, ultimately leading to cost savings and improved efficiency.
Conclusion
Calculation in ProdSys is an essential tool for maintaining control over costs and pricing. By leveraging both pre-calculation and post-calculation, businesses gain a comprehensive view of their expenses and profitability, allowing for informed decision-making and strategic planning. With ProdSys, you can ensure that every order is accurately priced, costs are controlled, and resources are managed effectively, leading to sustained business growth and success.