Product Cost & Margin Analysis — Sievo
In 2023, I designed a cost analytics tool for a multi-billion dollar manufacturing technology company. The tool united end-product structures, materials, and realized spend data. This project highlights how design and sourcing decisions can impact final product costs & the bottom line.
The Challenge
For this company, the product BOM and cost data were in different systems. Engineering knew what components made a product but couldn’t see how material choices, supplier prices, or cost changes affected finished-product margins over time. Procurement and finance had detailed invoice and PO data but didn’t know how those costs translated into what they were selling.
The Solution
I designed and implemented a BOM cost analytics solution that integrated multi-level product and material data and connected raw materials to historical spend.
The system supports flexible BOM roll-ups and explosions to move between component and finished-product views and provides standard versus actual cost (PPV) analyses to highlight margin variance. I partnered closely with procurement, finance, and operations teams throughout the project.
The Outcome
The tool provides procurement, finance and engineering with:
Clear visibility into true product cost
Ability to track how material and sourcing changes impact margin
Faster identification of cost pressure at the component level
More confident pricing, sourcing, and product decisions
Why It Matters
No matter the industry, tiny design or sourcing changes impact margin in big ways. This project shows how thoughtful operational & tool design can support teams by making costs transparent, traceable, and actionable without getting in the way of the product vision.