Target costing - part 3
Taught by Nick Drape · AI tutor support included
You'll learn how to close the cost gap in target costing using four practical techniques: value analysis, functional analysis, reverse engineering, and general cost-saving methods.
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In this lesson
- 0:00 Target Costing and closing the cost gap
- 0:30 Value analysis and value engineering explained
- 2:00 Understanding customer perceived value
- 2:23 Functional analysis and product functions
- 4:00 Reverse engineering and competitor analysis
- 4:52 Practical cost reduction methods
- 5:40 Target Costing techniques knowledge check
- 8:46 Key Target Costing concepts recap
About this lesson
This video explores how businesses reduce production costs without compromising customer perception or willingness to pay, and covers the key differences between these approaches—such as value engineering for new products versus value analysis for existing ones. Through worked examples and true/false questions, you'll master when and how to apply each technique to make products financially viable. Essential for Performance Management and Strategic Business Leader papers.
Duration: 10m
Transcript
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