Operating costs are expenses that are related to the operation of a business, or to the operation of a device, component, equipment or facility. They are the cost of resources used by an organization just to maintain its existence.[1]​.

For a commercial company, operating costs fall into two broad categories:

Business overhead is the cost of resources used by an organization just to maintain its existence. Overhead costs are measured in monetary terms, but non-monetary terms are possible in the form of time required to perform tasks.

Examples of overhead expenses include:

Non-overhead expenses are incremental costs, such as the cost of raw materials used in the products a company sells.

Operating cost is calculated as cost of sales - Operating expenses. Operating expenses consist of:.

It includes all operating expenses, such as salaries, rent, stationery, furniture, etc.

In the case of a device, component, equipment or installation (for the remainder of this article, all of these items will be referred to generally as equipment) are the regular, normal and customary recurring costs of operating the equipment. This does not include the capital cost of constructing or purchasing the equipment (depending on whether it is owner-made or received the product of a built system).

Operating costs are incurred for all equipment - unless the equipment costs nothing to operate, requires no personnel or space, and never wears out (examples? perhaps intangible, although not the equipment). In some cases, equipment may appear to have low or no operating costs, either because the cost is not recognized or is absorbed in whole or in part by the cost of something else.

Equipment operating costs may include:

Some of them are not applicable in all cases. For example:.

It may be questionable to claim that the cost of every ten additional people in the sales force are an additional cost or an overhead cost, since the salaries of these people are both overhead costs and incremental costs. The staff needed to keep the store operational is mostly considered overhead.