About this book:

Factory Finance provides manufacturing leaders with a comprehensive toolkit for linking operational decisions to financial outcomes. It begins by establishing the role of finance as a proactive partner that translates shop‑floor activities into monetary terms, covering fundamental cost classifications, unit economics, and the mechanics of absorption costing. The book then explores increasingly sophisticated costing methods—activity‑based costing, time‑driven ABC, and standard costing with variance analysis—to allocate overhead accurately, reveal true product profitability, and support internal decision‑making while remaining compliant with external reporting requirements.

Building on reliable cost models, the text turns to profitability and pricing. It explains contribution margin, break‑even analysis, and operating leverage as lenses for evaluating sales volume, pricing strategies, and product‑mix decisions under constraints, emphasizing bottleneck management and throughput accounting. Practical guidance is offered on quoting and RFQ cost models, lean accounting, flow‑based metrics, and value‑based pricing, together with frameworks for make‑or‑buy, outsourcing, and reshoring decisions that incorporate relevant costs, opportunity cost, and total cost of ownership.

Finally, the book addresses capital allocation and financial control. It details capital budgeting techniques (NPV, IRR, payback), risk and sensitivity analysis, working‑capital management and the cash conversion cycle, depreciation tax shields and government incentives, stage‑gate governance, and post‑investment benefits realization. Throughout, it stresses the importance of finance‑operations collaboration, integrated data systems (ERP, MES, digital thread), dashboards, KPIs, and rolling forecasts to transform cost information into actionable insights that lift margins, improve cash flow, and sustain competitive advantage.

What You'll Find Inside:

• Learn to build accurate product costing systems using absorption, activity-based, and time-driven ABC methods tailored for modern manufacturing environments.
• Master contribution margin and break-even analysis to set profitable prices, evaluate product mix under constraints, and make informed quoting decisions.
• Apply capital budgeting tools (NPV, IRR, payback) with risk and sensitivity analysis to evaluate investments and align CAPEX with strategic goals.
• Understand how to manage working capital and the cash conversion cycle to improve liquidity and operational efficiency.
• Discover how finance and operations collaboration, supported by ERP/MES data and dashboards, drives continuous improvement and margin growth.

Who's It For:

This book is designed for manufacturing leaders, plant managers, operations managers, finance controllers, and CFOs who need to translate financial data into actionable factory decisions. It is especially valuable for professionals involved in product costing, pricing strategies, capital investment analysis, and cost reduction initiatives. Engineers and production supervisors seeking to understand the financial impact of their operational choices will also benefit significantly.