What Are — Cost Drivers

Then Leo explained the secret language of business. She called them .

"A cost driver," Leo said, "isn't just a cost. It’s the activity that makes the cost appear. It’s the engine. The gas pedal." what are cost drivers

And she put up a small sign: No card for orders under $5. That eliminated fifty tiny transactions a week, saving $15 in swipe fees. Then Leo explained the secret language of business

Within two months, The Daily Rise's profit margin rose from 8% to 14%. The oven still wheezed. But now, Mariana knew exactly which pedal to push—and which to lift her foot from. It’s the activity that makes the cost appear

Mariana owned a bakery called "The Daily Rise." For two years, her books were a mess. She knew she spent money—on flour, on staff, on the old oven that wheezed like an asthmatic dog—but she couldn't tell why the costs went up and down.

One Tuesday, her accountant, a patient woman named Leo, sat her down with three months of receipts.

So she changed things.