To safeguard their ability to compete, companies are faced with the demanding challenge of combining a high quality of goods or services offered with efficient performance and optimized cost structures.
Costing plays a crucial role. It serves to collect, calculate and assign the costs of the production of goods and rendering of services by the company. The main purpose of modern costing is to provide the company's management with a basis for taking decisions.
The cost prices calculated by costing furthermore form the basis for the company's product pricing.
Another important component of an optimally operating company is controlling. Controlling is an instrument for directing a company which addresses the potential future developments of the company.
The central components of a comprehensive controlling system are the preparation of operating budgets and financial plans.
Even the smallest company needs a modicum of target figures, such as e. g. turnover, costs, liquidity protection, number of clients. It is important also for small service providers to determine which of their services has the greatest earning power, and which jobs have turned out to be huge expense, no recompense.