🛒 Procurement & Purchasing

Should-Cost Calculator

Build a transparent supplier target cost from the underlying cost elements.

Enter your figures

Results

Should-cost per unit

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Pre-margin cost

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Supplier margin

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This is a modelling tool. Real supplier economics may include tooling, yield loss, financing, certification and other factors not listed here.

Formula: Should-cost = pre-margin cost × (1 + supplier margin %).

How to use this calculator

What to enter

Enter or select the following as requested: Currency; Materials; Direct labor; Manufacturing overhead; Packaging; Inbound logistics; Supplier margin (%). Follow the units, valid ranges, examples, and options displayed beside each field.

What the result means

The procurement result compares supplier offers, minimum quantities, total cost, savings, or sourcing scenarios from the prices, volumes, exchange rates, and assumptions entered. Check whether freight, duties, taxes, quality, lead time, payment terms, and lifecycle costs are included.

When to use it

Use this to prepare a supplier comparison or sourcing decision. Validate quotes and contract terms and compare equivalent specifications, delivery conditions, and currency dates before selecting a supplier.