Definition of Cost control:
The process or activity on controlling costs associated with an activity, process, or company.
Cost control typically includes (1) investigative procedures to detect variance of actual costs from budgeted costs, (2) diagnostic procedures to ascertain the cause(s) of variance, and (3) corrective procedures to effect realignment between actual and budgeted costs.
Cost control is the practice of identifying and reducing business expenses to increase profits, and it starts with the budgeting process. A business owner compares the company's actual financial results with the budgeted expectations, and if actual costs are higher than planned, management has the information it needs to take action.
As an example, a company can obtain bids from different vendors that provide the same product or service, which can lower costs. Cost control is an important factor in maintaining and growing profitability.
How to use Cost control in a sentence?
- Cost control is the practice of identifying and reducing business expenses to increase profits, and it starts with the budgeting process.
- Cost control is an important factor in maintaining and growing profitability.
- Congress has often established blue ribbon bipartisan commissions with cost control authority to investigate, identify, and eliminate or freeze wasteful programs in a dysfunctional government agency.
- As the price tag for the new factory began to balloon out of control, Stewart brought in a group of his most loyal employees to perform a cost control analysis of the project.
- Outsourcing is a common method to control costs because many businesses find it cheaper to pay a third party to perform a task than to take on the work within the company.
- John was assigned to be responsible for cost control . He had to look at the actual cost of production versus what they were budgeting for the expense.
Meaning of Cost control & Cost control Definition