Variable costs are expenses incurred in the business that change depending on the level of production. As an example, if I produce one picture frame, the variable costs will include my labour and the materials needed to make the picture frame. Fixed costs will include those costs that do not vary with the level of output, including rental of the premises where I make my picture frame. If I make two picture frames, the cost of labour and materials will increase proportionally, but the fixed costs will not change.
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Discover the world’s largest Glossary of Procurement terms
With over 800 Procurement specific terms (and growing) you will find everything you need to know or thought you knew about the Procurement function. Our aim is to provide you with a comprehensive list collated from the Comprara Groups hub of training and procurement consulting source materials.The Procurement Glossary has been compiled by industry expert Paul Rogers.
