Silas felt a cold dread. He wasn't losing to a competitor with better coffee. He was losing to a competitor who understood why costs happened, not just what they were.
She continued. "Take labor costs. You pay your packers by the hour, Silas. We discovered our packing cost driver was —switching from one bag size to another. Each changeover cost us 22 minutes of idle time. We redesigned our line so that we pack all the 12-ounce bags, then all the 5-pound bags. Labor cost per unit dropped 18%." cost driver analysis
"That's the illusion," Elena said softly. "The same costs aren't driven by the same things." Silas felt a cold dread
He pulled out a notebook.
After the summit, Silas walked back to his creaky roastery. He watched Giacomo fire up the massive drum for a single 10-pound test batch. He saw two packers stop work for fifteen minutes to switch from kraft paper bags to valve bags. She continued