Enter the current cost, quantity of the product or service, and the price per unit into the calculator to determine the cost savings.
Cost Savings Formula
The following formula is used to calculate the cost savings.
CS = C - (Q * P)
Variables:
- CS is the cost savings ($)
- C is the current cost ($)
- Q is the quantity of the product or service
- P is the price per unit of the product or service ($)
To calculate the cost savings, subtract the product of the quantity of the product or service and the price per unit from the current cost.
What is a Cost Savings?
Cost savings refers to measures implemented by a company to reduce its expenses and improve profitability. This can be achieved through various methods such as streamlining operations, implementing new technologies, negotiating better deals with suppliers, reducing waste, or improving energy efficiency. The money saved can then be reinvested back into the business to stimulate growth and innovation.
How to Calculate Cost Savings?
The following steps outline how to calculate the Cost Savings using the formula CS = C – (Q * P).
- First, determine the current cost ($).
- Next, determine the quantity of the product or service.
- Next, determine the price per unit of the product or service ($).
- Next, substitute the values into the formula CS = C – (Q * P).
- Finally, calculate the Cost Savings.
- After inserting the variables and calculating the result, check your answer with the calculator above.
Example Problem:
Use the following variables as an example problem to test your knowledge.
current cost ($) = 150
quantity of the product or service = 10
price per unit of the product or service ($) = 20
