Data Labeling Cost Audit & Optimization Checklist

Use this framework to analyze current annotation spending, identify optimization opportunities, and build business cases for automation investments.

📊 1. Current Cost Structure Analysis

Establish baseline spending across all annotation-related expenses.

Monthly Cost Breakdown

Labor Costs (Human Annotators):

Cost Item	Monthly Amount	Annual Projection	% of Total
Annotator wages/fees	$_________	$_________	_____%
QA reviewer labor	$_________	$_________	_____%
Subject matter experts	$_________	$_________	_____%
Training time	$_________	$_________	_____%
Total Labor	$_________	$_________	_____%

Tooling & Infrastructure:

Cost Item	Monthly Amount	Annual Projection	% of Total
Annotation platform licenses	$_________	$_________	_____%
Cloud storage	$_________	$_________	_____%
Compute/GPU costs	$_________	$_________	_____%
API fees (auto-labeling, etc.)	$_________	$_________	_____%
Total Tooling	$_________	$_________	_____%

Quality Assurance:

Cost Item	Monthly Amount	Annual Projection	% of Total
QA tool licenses	$_________	$_________	_____%
Sampling/review labor	$_________	$_________	_____%
Rework costs	$_________	$_________	_____%
Total QA	$_________	$_________	_____%

Project Management:

Cost Item	Monthly Amount	Annual Projection	% of Total
PM/coordinator labor	$_________	$_________	_____%
Communication tools	$_________	$_________	_____%
Reporting/tracking systems	$_________	$_________	_____%
Total PM	$_________	$_________	_____%

Hidden Cost Identification

Rework & Error Correction:

Estimated % of labels requiring correction: _____%
Average time to fix errors: _____ hours/month
Estimated Monthly Cost: $__________

Coordination Overhead:

Hours spent on task routing: _____ hours/month