Product Cost Planning 
Product Cost Planning (CO-PC-PCP) is an area within Product Cost Controlling (CO-PC) where you can plan costs for materials without reference to orders, and set prices for materials and other cost accounting objects.
You can use Product Cost Planning to analyze your product costs, such as for:
Manufactured materials
Services
Analyzing product costs helps provide answers to questions such as:
What is the value added of a particular step in the production process?
What proportion of the value added can be attributed to a particular organizational unit?
What are the material, production, and overhead costs?
How can production efficiency be improved?
Can the product be sold at a competitive price?
Components of Product Cost Planning
Product Cost Planning comprises the following components:
Material Cost Estimate With Quantity Structure
Costing materials based on a quantity structure in Production Planning
Material Cost Estimate Without Quantity Structure
Costing materials without a quantity structure in Production Planning
Transferring the results of material cost estimates to the material master
Reference and Simulation Costing
Planning new products and services using base planning objects
Easy Cost Planning and Execution Services
Rapid cost planning without master data within an ad hoc cost estimate.
Implementation Considerations
In your organizational structure, each company code needs to be assigned to a controlling area.
Materials are always valued at valuation area level, while costing must be performed at plant level. You therefore need to define the plant as the valuation level in Customizing under
Enterprise Structure 
Definition Logistics - General Define valuation level 
. This creates a valuation area with the same name for each plant. All costing data is then stored with reference to a plant.
Integration
Product Cost Planning accesses master data in other components, such as BOMs, routings, and work centers in Production Planning, and cost centers, activity types, and business processes in Overhead Cost Controlling. Costing data within Product Cost Planning can also be made available to other applications. For example, you can update the standard price in the material master with the results of cost estimates, and valuate materials using this new standard price.
For more information, see Information for Other SAP Applications.
Caution
Because of this high level of data integration, SAP recommends that you make a thorough check before going live to ensure that the correct data is accessed for the quantity and value structures, to prevent incorrect costing results.
For more information about integration, see Origin of Costing Data.
Features
Functions
You can access the functions of Product Cost Planning from either the Accounting menu or the Logistics menu:
- Accounting Controlling Product Cost Controlling Product Cost Planning
- Logistics Production Product Cost Planning
- Logistics Production - Process Product Cost Planning
The following table gives you an overview of the menu and functions of Product Cost Planning:
Menu Option | Function | Cost Estimate |
|---|---|---|
| Costing Run with BOM and routing | Used to process mass data, and is created automatically with Production Planning data (product cost estimate) |
| Cost Estimate with Quantity Structure (with BOM and routing or master recipe) | Created automatically with Production Planning data (product cost estimate) |
| Created using data you enter manually (unit costing) | |
| Material Cost Estimate Without Quantity Structure | Created using data you enter manually (unit costing) or transfer from a non-SAP system |
Reference and Simulation Costing | Reference and Simulation Costing | Created using data you enter manually (unit costing) |
| Ad Hoc Cost Estimate | Created using a planning form (costing model) that can access the data in the SAP system |
Menu Option | Function |
|---|---|
| Price Update |
| Definition of procurement alternatives and mixing ratios for Mixed Costing |
| Define planning forms for Easy Cost Planning |
Menu Option | Functions Available | Examples |
|---|---|---|
Information System | Costing results |
|
Environment | Additional functions in Product Cost Planning |
|
You use different costing methods in Product Cost Planning depending on the availability of data in Production Planning (PP and PP-PI) and on the type of object you want to cost.
Automatic costing (also known as product costing)
The quantity structure (BOMs and routings or master recipe) for the material is automatically determined and valuated using data from Production Planning (PP or PP-PI).
For more information, see Cost Estimate with Quantity Structure: Process Flow.
Unit costing
This cost estimate calculates the costs for the following objects without accessing BOMs and routings in Production Planning:
Materials (for example, additive costs for a material cost estimate with quantity structure, material cost estimate without quantity structure)
Base planning objects
With this costing method, you enter the costing items manually. You can access existing SAP system data such as materials, business processes, cost centers, and activity types for this purpose.
For more information, see Unit Costing.
Multilevel unit costing
This cost estimate calculates the costs for the following objects without accessing BOMs and routings in Production Planning:
Materials (material cost estimate without quantity structure)
Base planning objects
With this costing method, you enter the costing items manually. You can access existing SAP system data such as materials, business processes, cost centers, and activity types for this purpose. You can also display the costing structure hierarchically and, using a worklist, access frequently used data.
For more information, see Multilevel Unit Costing.
Configuration Settings
You make the configuration settings for Product Cost Planning in Customizing for Product Cost Controlling.
For more information, see Preparation for Costing: Customizing and the Implementation Guide (IMG) for Product Cost Controlling.