Time-driven Activity-based Costing and Sustainable Business Practices: A Case Study of the Restaurant in Sriracha District, Chonburi Province

Abstract

          Product costing is crucial for business operations as it not only enhances operational efficiency but also strengthens long-term competitiveness. This research article thus aims to: 1) study the application of Time-Driven Activity-Based Costing (TDABC) in restaurants and classify menu items based on the Menu Engineering concept, and 2) study the level of knowledge and understanding of entrepreneurs in applying the TDABC system and sustainable business practices. This research is a qualitative study using a case study of a restaurant business in Siracha District, Chonburi Province. The researcher employed documentary analysis, Time-Driven Activity-Based Costing analysis, and in-depth interviews as tools for conducting this study.  The research findings reveal that applying TDABC improves the accuracy of product cost analysis and assists in classifying menu items according to the Menu Engineering concept, which entrepreneurs can utilise for strategic business planning. However, TDABC may not be suitable for certain activities, such as depreciation and rent, as these activities may not be directly related to time. This research also found that although entrepreneurs are ready to implement TDABC, they lack sufficient understanding, which may lead to errors in product cost determination. Additionally, the business possesses the knowledge, understanding and readiness to implement sustainable practices, contributing to long-term value creation for the company, society, and the environment.