Make or buy? Decide with numbers
Every manufacturer reaches a point where they ask: should I make this item myself or buy it ready? The answer isn't gut feel — it's numbers. Let's understand the make-or-buy decision, and how Zemam's Make-vs-Buy report compares your actual make-cost with your actual buy-cost so you decide right.
How the Make-vs-Buy report works
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1. Your actual make-cost
The system takes the item's actual make-cost from the production orders you executed in the period (materials + labor + costs) — not an estimate; it's what it actually cost you to make it.
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2. Your actual buy-cost
And it takes the average buy-cost of the same item from purchase receipts/invoices in the same period — also actual; it's what you paid the supplier.
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3. Compare per unit and total
It puts make-cost next to buy-cost and computes the saving per unit and the total saving at the quantity you produced. A clear number: how much making saved you (or cost you extra).
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4. The margin under both
And it computes the profit margin at your current selling price if you make vs if you buy — so you see the decision not just by cost, but by the final profit too.
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5. Decide with numbers
Instead of deciding by gut, you look at a table telling you per item: make it or buy it? — built on your real costs that feed inventory and the financial statements.
Why actual numbers?
The comparison is built on your actual costs (make and buy), not estimated prices — the same figures that value your inventory.
It shows the margin under both at your selling price — so the decision is based on profit, not just cost.
Voided or reversed movements are netted out automatically — so the comparison stays clean.
Understand the decision
When is making cheaper?
When your materials + labor cost less than the finished product from the supplier — common if you buy raw materials in bulk or have spare production capacity.
When is buying cheaper?
When the supplier sells the finished product cheaper than you can make it (their scale), or when hidden make-costs (time, waste) eat the difference.
The report's scope — honestly
The comparison covers items you actually manufactured in the period, against your actual costs (not a hypothetical supplier price list). So it answers: “for what I made, was making cheaper than what I actually paid to buy?”
In Zemam
The Make-vs-Buy report compares — for each item you made in the period — your actual make-cost with your average actual buy-cost, computing the per-unit and total saving and the margin at selling price under both. The figures come from the same cost movements that value your inventory and feed the ledger — not estimates.
Want to decide make vs buy with numbers?
Zemam compares your actual costs and shows the saving and margin per item. Try it free and see your decisions built on real numbers.