Standardised product costing lifted gross margin by 640 basis points
Food & Beverage Manufacturer
- Duration
- 9 months
- Team
- Partner, cost accountant, ERP consultant, BI developer
- Scope
- 87 SKUs, 3 production lines, 2 warehouses
- Region
- Nigeria
Client challenge
A mid-market beverage manufacturer priced 87 SKUs on rules of thumb. Rising input costs were quietly eroding margin and management had no visibility into per-SKU profitability.
The starting position
Pricing had been set by market feel and adjusted for inflation across the board. Bills of material were outdated, yields were unmeasured and the business genuinely did not know which of its 87 SKUs made money.
What we actually changed
Every BOM and routing was rebuilt from the factory floor up, standard costs were set and a monthly variance review put purchase-price, usage and absorption variances in front of the management team. Contribution by SKU and channel became the basis of a monthly pricing council.
Why it stuck
The decisions were commercial, not accounting: 22 SKUs repriced, 6 discontinued, 3 supplier contracts renegotiated. Once management saw margin move, the discipline defended itself.
Our solution
Implemented standard costing, BOM discipline and monthly variance analysis. Built a manufacturing dashboard covering yield, scrap, labour absorption and contribution by SKU and channel.
Business outcome
Repriced 22 loss-making SKUs, discontinued 6 and negotiated 3 supplier contracts. Gross margin expanded from 27.4% to 33.8% within nine months.
- 1
Product cost diagnostic across 87 SKUs and 3 production lines.
- 2
Rebuilt BOMs and routings; introduced standard costs with monthly rolling review.
- 3
Deployed Odoo Manufacturing + Power BI for real-time yield and variance tracking.
- 4
Executive dashboards and pricing council chaired monthly by the MD.
standard cost with rolling review
verified on the line
loss-making before
core input categories
at current volumes
inventory reduction
| Metric | Before Soteria | After Soteria |
|---|---|---|
| Gross margin | 27.4% | 33.8% |
| Inventory days | 61 | 42 |
| Scrap rate | 4.2% | 1.8% |
| On-time-in-full | 85% | 96% |
"For the first time we know which SKUs make us money. That single insight is worth every naira of the engagement."
We can run this playbook for your manufacturing organisation.
In a 45-minute confidential briefing, the partner who led this engagement will benchmark your current numbers, identify the three fastest sources of value and give you a written scope with fixed fees — at no cost.
- Partner-led, not junior-staffed
- Fixed-fee scope before we start
- First results inside 90 days
- NDA signed before any data moves
From spreadsheet chaos to consolidated stewardship reporting in 90 days
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