• Wade Myers

Other Direct Expenses

Q: I’m trying to understand where to put my various expenses. What expenses should I put in your Other Direct Expenses category?

A: The Other Direct Expenses section (Section 2.16, directly after all the Offerings) allows you to enter a direct expense line item that may not fit within the offering costs.

For example: this cost might be something like a monthly hosting fee that has a cost for each dedicated hosting server and increases periodically as you need to bring another dedicated server online, not on a per-customer basis.

Note: If the expense is not something that scales directly with the product or service you provide, include it in Overhead Expenses, not Direct Expenses. See our blog post on Modeling Overhead Expenses.

To enter these expenses, simply:

  1. Choose a concise name for the section that describes the type of cost. This name will be reflected in the reports.

  2. Enter the cost for this expense on a monthly basis

  3. If you would like to include more than one expense in this section, you can add the monthly totals together and entitle the section something generic like “Other Direct Expenses”

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