The Cost Models feature allows you to create a model representing the cost evolution of a composite product, involving different raw materials according to proportions that you enter in CommoPrices.

You can integrate raw material inputs, but also packaging prices (paper, cardboard, plastic, etc...) or macroeconomic indices such as transport or labor costs.

Creating and monitoring the evolution of costs in a model allows you to understand the evolution of a composite cost structure, and to identify, for example, the cost drivers.

For example, you will no longer only know the price of cocoa, but will be able to model the evolution of Nutella, by mixing cocoa, sugar, palm oil, hazelnuts, etc. in your model.

Create a cost model

To create a cost model model, you must click on "Create a Cost Model" in the Analysis tab:

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You can then give a name to your cost model, and enter the type of data: price or index.

Note that the index allows you to compose with elements of different units, such as the hourly labor cost and the weight of an ingredient. However, as for any series, you can also index your model in €/kg for example.

N.B.: You can also add a prefix to the currency or unit which can be very useful if you want to get a model in €/350g for example.

You will then be asked to enter the different components of your model, as well as their weighting (%) within the model. The model can be generated as soon as the total of the ingredients reaches 100%.

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