Cost (Project Management)

Costing is a calculated cost of something: the cost that has been calculated for undertaking a project

All manufacturing companies sell their products to make profit. The profit on each product sold can be defined as the difference between the selling price of the product and the total cost of making the product. Cost therefore plays a very important role in the product design process. To be successful, a product must not only satisfy a set of functions defined in the product design specification, but it must also be possible to build the product within the cost criteria set out at the start of the project. Before the development of any product begins, it is essential to perform some form of economic analysis on the product to determine if it is worth making. This may involve some form of market analysis to determine what the customer is willing to pay for a product.