The Universal Necessity
et’s put our industries aside for a moment. What you do every day matters. You deliver valuable products and services to your market, impacting those who depend on you. Whether you offer a broad range of services to the worldwide community or programs to a targeted local group, clarity of your true costs on a unit by unit basis is critical to ensure sustainability, maximize impact, and create internal efficiencies.
As the diversity of your services increases, the true cost of delivering a service becomes increasingly opaque. This blurring of costs across different programs is not due to poor accounting practices or lack of proper planning and budgeting, it is due to the uncertainty of indirect costs and how to apply it. Nonprofits, governments, or for profits, all share the same challenge: how to assign organization wide shared costs (indirect costs) to the end product line or service received. All organizations have shared support services that benefit the entire organization at variable levels per program. The difficulty comes when adding these indirect shared costs onto your organizations direct costs to calculate your true cost of midstream or endpoint products or services.
capturing &
understanding your true costs:
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