Beneath The Surface

A little more than a decade after it became widely known, ABC is still in its youth, according to Cokins. He predicts a major upsurge in interest in the technology after the turn of the century, as trends toward product and market proliferation continue and competition steadily increases.

Despite the optimism of ABC advocates, the technique isn't for every business. Companies with only a few products and markets aren't likely to get as much benefit from basing costs on activities as companies operating with diverse products, service lines, channels and customers.

But one of the most attractive features of ABC is that it's something you can experiment with without making a huge commitment. "If it doesn't work," says Cokins, "you just stop doing it." Benefits, on the other hand, can be both big and long-lasting.

At Bluemount Nurseries, ABC helped Pindale determine he could breed some plant varieties at about half the cost of buying from wholesalers. "Using those numbers, we were able to sit down with the bank and borrow to build a new propagation facility," he says. "They were really impressed with our figures and graphs, and that loan went straight to the bottom line."

Contact Sources

ABC Technologies Inc., (503) 617-7100, http://www.abctech.com

Bluemount Nurseries Inc.,http://www.bluemount.com

This article was originally published in the October 1999 print edition of Entrepreneur with the headline: Beneath The Surface.