How much should it cost? An introduction to management use of costing information.

With the introduction of the internal market the health service is changing rapidly and health libraries must change with it. Many libraries are requested to cost their services. The demand comes from external customers and from their own organizations. This paper discusses the various reasons for costing services and how costing information can influence our management decision making. The paper challenges librarians to move costing processes away from a mechanistic approach, towards a means of demonstrating the worth of a library resources unit in cost and qualitative terms. Using costing information for cost control purposes, comparison of cost with other providers, setting prices or determining future service delivery levels is discussed, as well as considering the question of external provision of library services. Use of information on fixed and variable costs and assessing break-even levels of service provision is illustrated as a helpful guide to library survival.