Operating Costs

What is the definition of Operating Costs in the hotel industry?

Operating Costs, also recognized as Cost of Goods Sold (COGS), is a cost which is directly associated to everything desired to keep a trade up and running.

Examples for Operating Costs comprise items such as payroll, rent, office supplies, utilities, marketing, insurance, accounting, legal costs and taxes. Calculating Operating Costs needs only that you put in up the expenses that build up your yearly fixed costs and your variable costs. To decrease Operating Costs many businesses amplify their outsourced staff or become more eco-friendly (lower electricity bills, no paper, etc.).