ExamplesLand that can be sold after a development project fails.Cutting back on advertising when products sales are lower than expected.A retail shop that cuts back on shifts when a recession hits.A contingent workforce that can be released when a project fails.Inventory that can be sold at a clearance price to make way for a new product line.
ValueMaking decisions based on costs that you can change as opposed to sunk costs that are already unrecoverable.
|Overview: Prospective Cost|
A future expenditure or past cost that can be recovered.
A cost that is within your power to change within the context of a decision or strategy.