What is a cost cube?

This model innovatively portrays cost aspects through three distinct dimensions, offering a comprehensive view of the cost landscape. One such dimension revolves around product costs and structure costs, which occupy the vertical axis of the cost cube.

The vertical axis represents the depth of cost analysis, delving into the intricacies of how costs vary across products and their underlying structures. It enables businesses to identify cost drivers specific to individual products or product lines, facilitating targeted cost reduction strategies.

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The cost cube is an established model in the realm of cost analysis, transcending the realm of mere theory. Its practical value lies in its ability to elucidate intricate cost behaviors, providing businesses with a robust framework for decision-making.