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Target costing can lead to significant disadvantages, including potential compromises on product quality as companies strive to meet cost targets. It may also result in reduced flexibility, as stringent cost constraints can limit innovation and design changes. Furthermore, the focus on cost reduction might hinder collaboration among departments, as teams may prioritize their own objectives over a cohesive product strategy. Lastly, it can create pressure on suppliers, potentially damaging long-term relationships.

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6d ago

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