Strategic Cost Management and Industrial Efficiency: Evidence from Target Costing in an Iraqi Manufacturing Enterprise
Strategic Cost Management and Industrial Efficiency: Evidence from Target Costing in an Iraqi Manufacturing Enterprise

Summary/Abstract: Improving cost efficiency and financial sustainability remains a critical challenge for manufacturing enterprises operating in transitional economies. This study examines the role of strategic cost management through the application of target costing in an Iraqi manufacturing enterprise, using the Babylon Battery Factory as an empirical case study. The research analyzes pricing structures, production capacity, and cost components in order to evaluate the alignment between internal production costs and market-based pricing mechanisms. The empirical results reveal a significant gap between the actual production cost of the A60 battery and the allowable target cost determined by competitive market prices. The findings demonstrate that the adoption of target costing enables firms to identify inefficiencies in production processes and implement cost-reduction strategies without compromising product quality. Furthermore, the integration of value analysis contributes to improving resource allocation and operational performance. The study highlights the importance of market-oriented cost management practices for enhancing industrial efficiency and strengthening competitiveness in manufacturing enterprises operating within transitional economic environments. This study provides empirical evidence from an Iraqi manufacturing enterprise showing how target costing can serve as an effective strategic cost-management tool for improving industrial efficiency and financial sustainability.

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