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Overheads
Business
WHAT IS IT?
Overheads are the regular business costs that support the operation of the business but are not normally treated as direct costs of an individual sale.
IN PLAIN ENGLISH
They are the costs of keeping the business running.
SIMPLE EXAMPLE
Examples can include premises, some insurance, software, utilities, accountancy and other regular operating costs.
WHY DOES IT MATTER
Keeping track of overheads helps you understand your break-even point and where costs may be leaking away.
THE ROCKET TEST
Overheads are the regular costs of keeping the business running.
SEE IT IN ACTION
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