Strategic Cost Management and Industrial Efficiency: Evidence from Target Costing in an Iraqi Manufacturing Enterprise
Improving cost efficiency and financial sustainability remains a critical challenge for manufacturing enterprises operating in transitional economies. This study examines the role of strategic cost management through the application of target costing in an Iraqi manufacturing enterprise, using the Babylon Battery Factory as an empirical case study. The research analyzes pricing structures, production capacity, and cost components in order to evaluate the alignment between internal production costs and market-based pricing mechanisms. The empirical results reveal a significant gap between the actual production cost of the A60 battery and the allowable target cost determined by competitive market prices.
The findings demonstrate that the adoption of target costing enables firms to identify inefficiencies in production processes and implement cost-reduction strategies without compromising product quality. Furthermore, the integration of value analysis contributes to improving resource allocation and operational performance.
The study highlights the importance of market-oriented cost management practices for enhancing industrial efficiency and strengthening competitiveness in manufacturing enterprises operating within transitional economic environments. This study provides empirical evidence from an Iraqi manufacturing enterprise showing how target costing can serve as an effective strategic cost-management tool for improving industrial efficiency and financial sustainability.
Copyright© 2026 The Author(s). This article is distributed under the terms of the license CC-BY 4.0., which permits any further distribution in any medium, provided the original work is properly cited.
Article’s history: Received 30th of November, 2026; Revised 19th of January, 2026; Accepted 21st of February, 2026; Available online: 15th of March, 2026. Published as article in the Volume XXI, Special Issue 1(91), 2026.
Khalf, A. I., Abed, E. M., Altameme, A. J., & Utaiwi, K. H. (2026). Target Costing and Value Analysis as Pillars of Financial Sustainability: An Applied Study on Iraq’s Industrial Sector. Journal of Applied Economic Sciences, Volume XXI, Special Issue, 1(91), 365 – 386. https://doi.org/10.57017/jaes.v21.si.1(91).19
Acknowledgments: The author expresses sincere appreciation to the administration of the Department of Accounting Techniques, Technical College in Baqubah, and to the College Deanship for their valuable institutional support and constructive cooperation, which contributed to the successful completion of this research.
Conflict of Interest Statement: The author declares that the research was conducted in the absence of any commercial or financial relationships that could be construed as a potential conflict of interest.
Data Availability Statement: The data supporting the findings of this study were obtained from internal production and operational reports of the Babylon Battery Factory. Due to institutional confidentiality restrictions, these data are not publicly available but may be provided by the author upon reasonable request.
Ethical Approval Statement: This research was conducted in accordance with standard ethical principles for academic research. Participation in the consumer preference survey was voluntary and anonymous, and respondents were informed about the purpose of the study. No personal or sensitive information was collected.
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