Explaining Value Added -- Dickeson

Taking Stock

We need to estimate materials that are required for a job. That's all. If a customer wants to use low grade stock, the price goes down with the cost of the waste. Higher priced stock bears a greater burden of waste cost and, consequently, a higher price. If we're doing a good job of holding the waste down we can expect to gain more from that job. That's one job cost directly related to job profitability.