Open book costing
A customer requirement to disclose your cost structure line by line on their form, so a decomposed price can be compared and negotiated against.
Open book costing means submitting your cost breakdown on a customer’s template rather than quoting a single number. Material, labour by operation, outside processing, overhead and margin all appear as separate rows on a form the buyer designed.
The benign purpose is comparison. A buyer with 40 suppliers cannot read 40 formats and wants one, and the form makes your number comparable to everyone else’s and to their own should-cost model.
The commercial purpose is negotiation. A single price invites one argument. A decomposed price invites an argument per line, and every row becomes somewhere to push. That is not a reason to refuse, since refusing usually ends the conversation, but it is a reason to fill the form carefully.
The defence is consistency. The form has to total to the quote it came from, the rates have to be the rates you actually use, and the mapping between your lines and their rows should be written down and reused. How to fill a customer’s cost breakdown form sets out where the traps are.