overhead

Vocabulary Word

Definition

'Overhead' refers to ongoing business expenses that aren't directly tied to creating a product or service. This includes rent, utilities, and salaries for employees not involved in production.

Examples in Different Contexts

In business, reducing overhead costs can lead to higher profits. A CFO might say, 'We need to cut down on overhead expenses to improve our financial performance.'

Practice Scenarios

Sustainability

Scenario:

We need to strategize our funds for maximum impact. High administrative costs could dilute our efforts towards environmental projects.

Response:

Absolutely. Lowering overhead could allow us to allocate more resources to our sustainability initiatives.

Tech

Scenario:

As our user base grows, so does the need for server space and technical support. These are direct costs we should not overlook.

Response:

Right, we should account for the rise in overhead due to increased server space and a larger tech support team.