Outsourcing Walmart analysis

It, therefore, follows that sunk costs, committed costs and notional costs such as depreciation and fixed overheads are not relevant in marginal cost analysis (Tjader, May, Shang, Vargas, & Gao, 2014). Walmart is considering outsourcing its facilities management. The relevant costs of outsourcing these services relate to the differential cost between operating an internal service department and the use of external services. Potential outsourcing firms include Serco and G4S who offer specialist services, superior quality, and efficiency at a cost. In evaluating the decision, the leasing charges are committed costs and therefore not decision relevant cost. After careful analysis of the relevant costs and the qualitative aspects of the options, a decision will then be taken. References Tjader, Y. , May, J. H.