What Is a Running Yield?

Cost control is a series of preventive measures taken by an enterprise based on cost management objectives established in advance in a certain period of time, and within the scope of its authority, before the cost of production and in the process of cost control, various factors and conditions that affect costs. And management actions to ensure that cost management objectives are achieved.

Operating costs

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The process of cost control is the process of calculating, adjusting and supervising the various costs incurred by the enterprise during the production and operation process using the principles of system engineering. It is also a process of finding weak links, tapping internal potential, and finding all possible ways to reduce costs. . The scientific organization and implementation of cost control can promote enterprises to improve their management, transform their operating mechanisms, comprehensively improve their quality, and enable them to survive, develop, and grow in a market-competitive environment.

Cost control refers to

In enterprise development strategy, cost control is extremely important. If the performance and quality of similar products are almost the same, the main factor that determines the product's competition in the market is the price, and the main factor that determines the price of the product is the cost, because it is only possible to reduce the price of the product if the cost is reduced. The goal of cost management control must first be the control of the entire process.It should not only control the production cost of the product, but should control the entire content of the product life cycle cost. Practice has proved that only when the product life cycle cost is effectively controlled, the cost Will be significantly reduced; and from the perspective of the whole society, only in this way can we truly achieve the goal of saving social resources. In addition, companies must take into account the continuous innovation of products while carrying out cost control, especially to ensure and improve the quality of products. They must not ignore the variety and quality of products in order to reduce costs unilaterally, nor can they pursue immediate benefits for one-sided To reduce costs by adopting crooked practices such as cutting corners, counterfeiting, or crude production; otherwise, the result will not only harm consumers, but will eventually cause the company to lose credibility and even go bankrupt.

Full involvement in operating costs

The principle of comprehensive intervention refers to the control of all, all employees and the entire process of cost control. All is to control all the costs of product production, not only to control the variable costs, but also to control the fixed costs. Full staff control is to mobilize leading cadres, managers, engineering and technical personnel and the majority of employees to establish cost awareness, participate in cost control, and realize the significance of cost control before they can be put into action. Full process control, controlling the product design, manufacturing, and sales processes, and reflecting the results of the control on relevant reports to discover shortcomings and problems.

Operating cost exception management

Cost control should focus on the unusual situation. Because the actual costs often go up and down with the budget, if there is not much difference, there is no need to find out the reasons one by one, but only focus on the abnormal exceptions and timely feedback.

Economic benefits of operating costs

Improving economic benefits not only depends on reducing the absolute number of costs, but more importantly, achieving relative savings, achieving the best economic benefits, and achieving more results with less consumption.