Template:Cost centre capsule

A “cost center” in a firm is a department that does not directly earn revenue but still costs money to operate. Cost centers therefore only contribute to profitability indirectly, by enabling profit centres to operate, helping them operate better, and preventing money made by profit centres being lost again. Cost centres may be, and usually are, also waste centres, but that is not to say cost and waste centres are the same: to confuse them is to make the fundamental mistake of modern management.