HubSpot: Fixed Cost: What It Is & How to Calculate It

HubSpot just shared a new interesting blogpost:

“Business is personal — it’s the most personal thing in the world.” These are famous words by Michael Scott from the TV show, The Office. And although this quote conflicts with the universal belief that business isn’t personal, Michael’s point of view is perfect when learning about a business’s fixed costs — or those costs that don’t change as a company grows or shrinks. To identify and calculate your business’s fixed costs, let’s start by looking at the ones you’re already paying in your personal life. Then, we’ll explain how a business manages its own fixed costs and review some common fixed cost examples. Fixed costs are distinguished from variable costs, which do change as the company sells more or less of its product. To better understand how fixed and variable costs differ, let’s use personal finances as an example. As a single adult, your expenses would normally include a…

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