Measures the total cost of producing a unit of product, including raw materials, labor, and overhead, to assess cost efficiency.

What it Measures ?

How much each item costs to buy.

Relevant StakeHolders 

Finance Teams, Buyers

In-depth Use Case / Real-world Example

A company producing plastic components for automotive parts calculates the Cost per Unit by adding up the cost of raw materials, labor, equipment usage, and overhead for each unit produced. For example, if it costs ₹50 to produce one plastic component, the company can evaluate ways to reduce costs, such as by negotiating lower raw material prices or improving production processes. This metric helps identify opportunities for cost savings and efficiency improvements in manufacturing.