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Manufacturing Software Systems

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Jennie Miller

Direct and indirect costs are factors involved in running a business. Direct costs are those costs directly associated with the manufacturing or production of a product. This includes labor that is directly related to making the product and purchased materials which are directly related to making the product. Engineering costs can be applied directly to a product so they would be included in direct costs.

Indirect costs are those costs that cannot directly be related to the production of a specific product.  These would include the basic overhead which is used in the production of all the different products at the company.  Some examples would be rent, wages of supervisors and managers, office staff, electricity and power consumption, repair and maintenance costs, and even consumables like gas, oils, and lubricants.

In the world of manufacturing, a software package which can handle direct and indirect costs is a must. This type of software can help your manufacturing company become more competitive and cost-saving. 

Source: https://www.mie-solutions.com/founders-blog/estimating/classification-of-costs-direct-and-indirect-costs-5

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Jennie Miller
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