Investment on Human Asset Can Reduce Product Cost
What is cost? Cost plays a very important role in the profits of any business. If a business manages cost it can enhance its profit margin. As we are focusing on the cost of production of the goods, therefore in this context we can define cost as the money spent on the manufacturing or production of the goods. We can say that cost is the monetary evaluation of effort, material and resources. Cost includes the direct material cost, direct labor cost and factory overheads (FOH). In order to increase the profit and survive in the market, a company needs to reduce its cost. One thing is for sure, if a company is able to reduce its cost then there is a great chance of its success. Actually the concept of cost control is different from cost reduction. Cost control point towards the exercise in constraint. While on the other hand the cost reduction refers to the process of reducing expenses that are high. So controlling cost is different from reducing cost. Our main