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Purchase price variance is a financial metric used in procurement and supply chain management to assess the difference between the expected (also known as standard or baseline) cost of an item and its actual purchase cost. PPV measures the gap between what the company planned to pay for a product or。 See more

PPV can be either favorable or unfavorable and may be tracked for specific time periods (monthly, quarterly, yearly). It is often reported in terms of total procurement spend. Purchase price variance is an important metric for。

Read more: Cost Variance: Definition, Formula and Examples Why is PPV important? Most manufacturers agree that raw materials take up most of their running costs,。

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