10/20/2026
One production batch. Two different products. But do you really know what each one costs? 🤔
Let's say you're running a food, dairy, or chemical manufacturing business.
You run one production batch, but instead of getting just one finished product, you end up with a main product and a valuable by-product.
That's great! But now comes the tricky part.
How do you split the production costs between them?
You've already paid for raw materials, labor, equipment, and processing.
But knowing how much each product actually costs isn't always straightforward.
And if your team is spending hours working through spreadsheets just to make the numbers add up, it's worth taking a closer look at your costing process.
Here's a quick checklist for your next production review:
✅ Track the total batch cost. Know exactly what went into producing that batch.
✅ Identify every usable output. Don't overlook co-products or by-products.
✅ Use a consistent costing method. Make sure production costs are allocated correctly.
✅ Review your profit margins. Understand how those costs affect pricing, inventory value, and profitability.
Because at the end of the day, it's not just about how much you produce.
It's about knowing how much it costs to produce it.
Better production costing gives your team the information it needs to make smarter decisions.
💬 For manufacturing owners and operations managers: How does your team handle batch costing today?
Are you using a manufacturing ERP system, or are spreadsheets still doing most of the work?
