Activity-Based Cost Control Of SME

As a downstream industry of the construction industry,the brick and tile industry has a sales market which is the construction side market.The advantage of pricing is small,and the pressure of market competition is great.In recent years,the rising costs of raw materials,energy,and transportation have added pressure to brick and tile enterprises to reducing cost.Due to the deficiencies of the cost control method,one single cost control method cannot achieve full-scale cost management.The adoption of multi approaches for cost control will help the managers establish a sound cost control system.On the other hand,Activity Analysis has become more widely used in cost control practices.By determining the nature of activities,optimizing activity flow,cost control goes deeper into the “activity” level.J Company is a medium-sized private brick and tile enterprise and has established a set of cost accounting and management system.However,in recent years,with the intensified market competition and the continuous practice of production,the original cost control measures have revealed many problems,the cost control system needs to be optimized as well.This article describes and analyzes J Company's cost control measures and the corresponding issues.The activities of the production workshop were checked with the perspective of the operation cost management,.The paper explains the optimization of cost effect after the operation upgrade.In this paper,the value chain cost theory,Activity Based Management theory and target cost method are proposed to optimize the cost control of J Company.The similarity of production technology of brick and tile industry can makes the result of the Activity Analysis of J Company workshops universal.The upgrading of J Company's workshop and suggestions of their cost control show some experience to other companies,give them new ideas for their cost reduction and cost control.