Costing isn’t Excel decoration; it’s survival math. Get it wrong, and you’re not just fooling investors — you’re fooling yourself. Illusions don’t pay bills.
Step 1 of 4
Q1: Bookkeeping vs. Costing; When you calculate “cost per unit,” what do you actually include?
Only raw materials and salaries — basics covered, right?
I add some overheads, but not every small detail.
I account for all direct and indirect costs.
Q2: The Average Cost Trap; How do you use averages in costing?
I rely heavily on average cost — it balances out.
I sometimes average, but I also check major outliers.
I break it down per unit, per channel, per geography.
Q3: Hidden Costs; Do you account for things like your own time, spoilage, pilferage, and compliance?
No — founder time is free, and spoilage is “minor.”
Sometimes I consider them, but not consistently.
Yes — I add even small costs into unit economics.
Q4: Pricing Logic; How do you set your price?
I price by gut feel or competition benchmarks.
I balance costs with market benchmarks.
I always base pricing on actual costs + value delivered.
Q5: Scaling Assumptions; How do you expect costs to behave as you scale?
Scale automatically reduces per-unit cost.
I assume some costs fall, but I don’t recalc often.
I recalculate costing at every growth stage.
Q6: Small Errors; How do you treat small costing gaps (₹2 here, 1% there)?
I ignore them — too small to matter.
I notice them, but don’t always fix.
I treat every leak seriously, no matter how tiny.
Q7: Courage to Face Numbers; How do you emotionally react to costing truths?
I avoid digging deep — optimism feels safer.
I look at numbers, but downplay the ugly ones.
I confront costing realities head-on.
Q8: Founder’s Own Cost; Do you factor your own time and salary?
No, my sweat equity is free.
Sometimes, depending on investor advice.
Yes, I always include founder cost.
Q9: Costing Granularity; How often do you drill down costs per channel/geography?
Rarely — I prefer broad averages.
Occasionally — when something looks off.
Regularly — I map costs per channel, geography, customer type.
Q10: Profitability Claim; When you say “I’m profitable,” what do you mean?
That topline > expenses — ignoring hidden costs.
Net profit after major costs, though not fully granular.
Net profit after all costs, hidden and direct.