SG&A

Description of SG&A. Explanation.

Definition SG&A. Description.

SG&A is short for Selling, General and Administrative Expenses, often also referred to as overhead. It is an item on the Profit and Loss Statement which combines all salaries, commissions, and travel expenses for executives, sales managers, and other employees, advertising costs, office payroll and expenses.

Analyzing this figure as a percentage of sales or net income and compare it to similar companies (Benchmarking) gives a good indication if the management keeps expenses under control. Low overhead costs are a factor determining profitability. Rapidly growing companies can sometimes somewhat lose control of costs. In Mergers and Acquisitions, cost reduction is frequently both a major promise and a disappointment.

SGA Expenses Forum

SG&A Cases and Examples
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