Courses

The lowest price is rarely the cheapest. This Level 2 course teaches you to look beyond price, with the cost analysis tools used by professional buyers and management controllers. You will break down a supplier's price into materials, labour, overheads, logistics and margin, and understand its break-even point. You will analyse prices using comparisons, raw material and labour indices, price revision formulas and a should-cost model. You will calculate the total cost of ownership (TCO) of two alternatives and the life cycle cost (LCC) of an asset, using the concepts of present value and discount rate. And you will justify a decision to produce in-house or buy (make-or-buy) using relevant costs and strategic factors. With three Excel exercises, a case study and a decision scenario. Fictitious companies and figures. The course is delivered in Portuguese.

What you will learn

• Break down a supplier's price into its cost components and interpret its break-even point.
• Analyse a price using comparisons, indices, revision formulas and a should-cost model.
• Calculate and present the total cost of ownership of two purchasing alternatives.
• Apply life cycle costing to equipment and assets, using the concept of present value.
• Justify a decision to produce in-house or buy using relevant costs and strategic factors.

Modules

1. Supplier cost structure51 min
2. Price analysis and should-cost61 min
3. Total cost of ownership (TCO)59 min
4. Life cycle cost63 min
5. Make-or-buy decisions51 min

Who it is for

Buyers, management controllers