It would be nice if a company could purchase only those resources in needed at precisely the time the resources were needed. Sometimes that happens. For example, direct materials are frequently purchased at the and in the amount needed. This kind of resource is called a flexible resource. Flexible resource are supplied as used and needed; they are acquired from outside sources, where the terms of acquisition do not require any long-terms commitment for any given amount of the resource. Thus, the organization is free to buy only the amount needed. As a result, the quantity of the resource supplied equals the quantity demanded. Materials and energy are examples. There is no unused capacity for this category of resources, since the amount of resource used just equals the amount purchased.
Since the cost of the resources supplied as needed equals the cost of resources used, the total cost of the resources increases as demand for the resource in increases. Thus, the cost of flexible resources is a variable cost.