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Should Costing & Cost Analysis for Procurement Training Course

Shows buyers how to estimate what goods and services should cost, analyze supplier cost structures and use that insight to negotiate fair prices.

PSS · Procurement Strategy & Strategic SourcingAll Levels#2399ClassroomEnglish , Arabic
Duration
5 Days
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Free substitution at any time · 30+ days' notice: full refund minus 10%. Cancellation policy

Course Overview

The Should Costing & Cost Analysis for Procurement Training Course equips procurement, category, contracts, and cost professionals with the methods and practical tools needed to estimate what goods, services, and projects should cost, analyze supplier prices and cost structures, and use fact-based cost insight to negotiate fair prices, control spend, and create value. In government entities, ministries, public authorities, oil and gas, petrochemicals, utilities, construction, manufacturing, healthcare, and large corporations, procurement teams frequently rely on price comparisons between bids or historical prices without understanding the underlying cost drivers. This limits their ability to challenge prices, assess cost reasonableness in single-source and limited-competition purchases, evaluate price escalation claims, and identify genuine cost reduction opportunities. The course covers should costing and cost analysis from principles to negotiation and supplier collaboration. Participants learn the difference between price analysis and cost analysis, the principles of should costing and clean-sheet cost modeling, and how to identify and analyze cost drivers. The program then addresses data sources and cost research, including commodity and price indices, labor rates, productivity, bills of materials, and process routings, and building should-cost models for materials, manufacturing processes, labor, overheads, logistics, duties, packaging, selling and administrative costs, and profit margins. Participants also examine should costing for services and projects, activity-based costing, learning curves, price analysis techniques, price escalation and indexation clauses, open-book and cost transparency arrangements, cost reasonableness assessment in single-source and public procurement, using should-cost insights in negotiation, value analysis and supplier cost reduction programs, links to total cost of ownership, and governance, confidentiality, and ethics in cost analysis. The course is delivered through hands-on Excel should-cost modeling exercises, cost breakdown analysis of supplier quotations, price escalation evaluations, negotiation simulations, and case studies. Participants leave with a should-cost model template for goods, a services should-cost model template, a cost breakdown analysis worksheet, a price escalation and indexation evaluation tool, and a should-cost negotiation preparation guide.

Learning Objectives

  • Analyze the role of should costing and cost analysis in procurement value creation and cost control on Day 1.
  • Distinguish between price analysis and cost analysis and determine when each should be applied.
  • Apply should costing and clean-sheet cost modeling principles to goods, services, and projects.
  • Identify and analyze cost drivers, including materials, processes, labor, overheads, logistics, and margins.
  • Use data sources and cost research, including commodity and price indices, labor rates, productivity data, bills of materials, and process routings.
  • Build should-cost models for manufactured goods covering material, processing, labor, overhead, logistics, duties, packaging, selling and administrative costs, and profit.
  • Build should-cost models for services and projects using labor rates, staffing models, utilization, and productivity.
  • Apply activity-based costing, learning curves, and price analysis techniques to evaluate supplier prices.
  • Evaluate price escalation claims and design price adjustment and indexation clauses.
  • Assess cost reasonableness in single-source, limited-competition, and public procurement situations and apply open-book and cost transparency arrangements.
  • Use should-cost insights to prepare for and conduct fact-based negotiations and supplier cost reduction programs.
  • Link should costing with total cost of ownership and value analysis and apply governance, confidentiality, and ethics in cost analysis by the end of Day 5.

Who Should Attend

This course is designed for procurement and purchasing professionals, category managers, strategic sourcing specialists, contract managers, and cost analysts and estimators who evaluate supplier prices and negotiate contracts. It is also relevant for procurement managers and directors, finance and cost control professionals, engineers and technical specialists supporting procurement, internal auditors reviewing procurement value, and members of tender and award committees. It is particularly valuable for professionals in ministries, government entities, public authorities, and government procurement agencies, in oil and gas, petrochemical, utility, and energy companies, in construction and infrastructure organizations, in manufacturing and industrial companies, in healthcare systems, and in large corporations managing significant third-party spend.

Learning Outcomes

  • Explain how should costing strengthens procurement decisions and negotiations.
  • Choose between price analysis and cost analysis for different purchases.
  • Build clean-sheet should-cost models for goods and services.
  • Identify the main cost drivers behind supplier prices.
  • Find and use reliable cost data and indices.
  • Estimate material, processing, labor, overhead, and logistics costs.
  • Estimate reasonable overheads and profit margins.
  • Apply learning curves and price analysis techniques.
  • Evaluate price escalation claims and draft fair indexation clauses.
  • Assess cost reasonableness in single-source and public procurement.
  • Negotiate confidently using fact-based cost insight.
  • Combine should costing with total cost of ownership and value analysis.

Course Outline

Course Outline:

Day 1

Foundations of Should Costing and Cost Analysis

  • The role of should costing in procurement value creation
  • Price analysis versus cost analysis
  • Should costing and clean-sheet cost modeling principles
  • Cost structures and cost drivers
  • Practical application: participants analyze a supplier price and identify the key cost drivers behind it
Day 2

Cost Data and Should-Cost Models for Goods

  • Data sources: commodity and price indices, labor rates, productivity, bills of materials, and process routings
  • Material cost estimation, yields, and scrap
  • Manufacturing process, machine, and labor costing
  • Overheads, logistics, duties, packaging, selling and administrative costs, and profit margins
  • Practical application: participants build an Excel should-cost model for a manufactured item
Day 3

Should Costing for Services and Projects and Price Analysis Techniques

  • Should-cost models for services: labor rates, staffing models, utilization, and productivity
  • Should costing for engineering, construction, and maintenance projects
  • Activity-based costing and learning curves
  • Price analysis techniques and comparisons
  • Practical application: participants build a services should-cost model and apply learning curve and price analysis techniques
Day 4

Price Escalation, Cost Reasonableness, and Transparency

  • Price escalation claims and their evaluation
  • Price adjustment and indexation clauses
  • Cost reasonableness in single-source, limited-competition, and public procurement
  • Open-book costing and cost transparency arrangements
  • Practical application: participants evaluate a supplier price escalation claim and draft an indexation clause
Day 5

Negotiation, Value Creation, and Governance

  • Using should-cost insights in negotiation planning and execution
  • Supplier cost reduction programs and value analysis
  • Linking should costing with total cost of ownership
  • Governance, confidentiality, and ethics in cost analysis
  • Final workshop: participants prepare and conduct a should-cost-based negotiation simulation and present a cost reduction plan

Upcoming Dates

Selected date

Rome · 15 – 19 Mar 2027 · Classroom

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CityDatesPrice per ParticipantEarly Bird
CairoScheduled
2 – 6 Nov 2026€3,300—
CasablancaScheduled
9 – 13 Nov 2026€4,300—
DammamScheduled
16 – 20 Nov 2026€4,200—
DohaScheduled
23 – 27 Nov 2026€4,400€3,960until 2 Nov
DubaiScheduled
29 Nov – 3 Dec 2026€4,400€3,960until 9 Nov
GenevaScheduled
7 – 11 Dec 2026€6,300€5,670until 16 Nov
IstanbulScheduled
14 – 18 Dec 2026€4,700€4,230until 23 Nov
Kuala LumpurScheduled
14 – 18 Dec 2026€4,400€3,960until 23 Nov
LisbonScheduled
21 – 25 Dec 2026€5,400€4,860until 30 Nov
LondonScheduled
28 Dec 2026 – 1 Jan 2027€5,600€5,040until 7 Dec
MadinahScheduled
4 – 8 Jan 2027€4,200€3,780until 14 Dec
MadridScheduled
11 – 15 Jan 2027€5,400€4,860until 21 Dec
MakkahScheduled
18 – 22 Jan 2027€4,200€3,780until 28 Dec
ManamaScheduled
25 – 29 Jan 2027€4,700€4,230until 4 Jan
MarrakeshScheduled
1 – 5 Feb 2027€4,300€3,870until 11 Jan
MilanScheduled
1 – 5 Feb 2027€6,000€5,400until 11 Jan
MunichScheduled
8 – 12 Feb 2027€5,400€4,860until 18 Jan
MuscatScheduled
15 – 19 Feb 2027€5,300€4,770until 25 Jan
OnlineScheduled
21 – 25 Feb 2027€1,700€1,530until 1 Feb
ParisScheduled
1 – 5 Mar 2027€5,700€5,130until 8 Feb
RiyadhScheduled
8 – 12 Mar 2027€4,200€3,780until 15 Feb
SingaporeScheduled
15 – 19 Mar 2027€6,700€6,030until 22 Feb
RomeScheduled
15 – 19 Mar 2027€5,800€5,220until 22 Feb
TunisiaScheduled
22 – 26 Mar 2027€3,800€3,420until 1 Mar
ViennaScheduled
29 Mar – 2 Apr 2027€5,700€5,130until 8 Mar
ZurichScheduled
5 – 9 Apr 2027€5,000€4,500until 15 Mar
AmmanScheduled
11 – 15 Apr 2027€3,100€2,790until 22 Mar
AmsterdamScheduled
19 – 23 Apr 2027€5,400€4,860until 29 Mar
BakuScheduled
26 – 30 Apr 2027€4,800€4,320until 5 Apr
BarcelonaScheduled
3 – 7 May 2027€5,400€4,860until 12 Apr

Available in: Istanbul · Dubai · London · Riyadh · Doha · Amsterdam

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