Outsourcing Decision Analysis

Work Exercise 13A with clicks. Use 33% to represent 1/3 when working the exercise.

Scenario: Omron Doors Company

Current Situation: Omron Doors currently produces 10,000 doorknobs per month. Venice Company has offered to sell comparable doorknobs for $3.80 each.

Your Task: Identify which costs are relevant for the make vs. buy decision and determine the per-unit relevant cost of making the product.

Cost Item	Total Cost	Per Unit Cost	Relevant?

Your Calculated Relevant Cost to MAKE

$0.00 per unit

Supplier's Offer Price (per unit):

Create Your Own Scenario

Company Name:

Product Name:

Monthly Production Quantity:

Supplier Name:

Supplier Price (per unit):

Scenario Description:

Cost Structure:

Unit-level Materials ($):

Unit-level Labor ($):

Unit-level Overhead ($):

Product-level Costs ($):

Product-level % Avoidable:

Facility-level Costs ($):

Part B - Opportunity Cost (Optional):

Monthly Lease Revenue ($):

Opportunity Description:

🏢 Outsourcing Decision Analysis Tool

Scenario: Omron Doors Company

Your Calculated Relevant Cost to MAKE

💡 Part B: Opportunity Cost Consideration

Create Your Own Scenario

Cost Structure:

Part B - Opportunity Cost (Optional):