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Target costing, when services are variable, it is possible to calculate an…

- - - - to be vital to design and manufacturing decision
  - - - to aim to reduce costs by
        
        identifying those parts of a product or service
        
        which do not value - where value is made up of both
        
        Use value
        
        Esteem Value
  - - - Component
      - Arrange cheaper staff
      - Acquiring new and efficient technology
      - training existing staff
- - - - the lack of substance
      - there is no substantial material
    - - to be created at the same time as they are comsumed
    - - to face the problem of maintaining consistency in the standard of output
      - when the service are delivered humans, it is very difficult to ensure that the same service is provided in exactly the same way every time
      - Customers expect it
    - - The services of a beautician, are purchased for a period of time
    - - Services do not result in the transfer of property. The purchase of a service
      - to purchase a right to use facility
  - - - when services do not have any material content, it is not possible to reduce costs to target level by reducing material costs
    - - can differ every time it is provided, and a standard service may not exist
    - - Mass service: banking sector, transportation, mass entertainment
      - Fast food, teaching, hotels and holidays...
      - Personal service: pensions and financial advice...