Overhead and Operating Expenses

These days, Internet businesses can charge so much less than physical businesses because they have low overhead.

According to Wikipedia:

In business, overhead, overhead cost or overhead expense refers to an ongoing expense of operating a business (also known as Operating Expenses - rent, gas/electricity, wages etc). The term overhead is usually used to group expenses that are necessary to the continued functioning of the business, but cannot be immediately associated with the products/services being offered[1] (e.g. do not directly generate profits).

Overhead expenses are all costs on the income statement except for direct labor,direct materials & direct expenses. Overhead expenses include accounting fees, advertising, depreciation, insurance, interest, legal fees, rent, repairs, supplies, taxes, telephone bills, travel and utilities costs.

Overhead is what you have to keep as low as possible. After all, it's not what you make it's what you keep. It's a basic cash driver.

When you start a business, you want to start with spending as little money as possible. Many people come to me saying, "I'm starting a business and I need a loan." If you don't have sufficient resources to start a business without borrowing large sums of money, give serious consideration to not starting it. The last thing you want to do is go broke because you had to pay a bunch of interest before your business ever got going.

Entrepreneurship is the life's blood of all my professional activities. It makes them go. And go read my mystery for free at wwww.kearneymusicschoolmurders.blogspot.com or buy it from Amazon.com more cheaply than you can print it out.