{"id":2191,"date":"2006-10-01T12:01:00","date_gmt":"2006-10-01T12:01:00","guid":{"rendered":"https:\/\/www.certitrek.com\/nlpa\/2006\/10\/01\/cost-savings-reporting\/"},"modified":"2021-07-29T03:43:34","modified_gmt":"2021-07-29T07:43:34","slug":"cost-savings-reporting","status":"publish","type":"post","link":"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-savings-reporting\/","title":{"rendered":"Cost Savings Reporting"},"content":{"rendered":"
I hope that you have enjoyed the article \u201cCost Savings Reporting: Dot The I’s\u201d<\/p>\n
An additional cost savings reporting formula with which you will want to be familiar is this:<\/p>\n
Savings = (LYP x TYQ) \u2013 (TYP x TYQ)<\/p>\n
Where,<\/p>\n
LYP = Last year\u2019s price<\/p>\n
TYQ = This year\u2019s quantity<\/p>\n
TYP = This year\u2019s price<\/p>\n
If you explain this formula to managers in conjunction with the principles taught in the aforementioned article, they are more likely to understand how you are coming up with the metrics in your cost savings report. Let\u2019s do an example\u2026<\/p>\n
LYP = $5<\/p>\n
TYQ = 100,000<\/p>\n
TYP = $4<\/p>\n
Savings = ($5 x 100,000) \u2013 ($4 x 100,000)<\/p>\n
Savings = $500,000 \u2013 $400,000<\/p>\n
Savings = $100,000<\/p>\n
I hope that the article and this blog post help you develop more believable cost savings reporting procedures. Good luck!<\/p>\n
Become a member of one of the world\u2019s largest procurement associations today.<\/a><\/p>\n <\/p>\n Recommended Reading\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/strong><\/p>\n\n