Operating expenses as a percentage of sales is the percentage of revenue that your company spends on operating expenses.
Operating expenses are the costs that your company incurs to run its business. These include things like salaries, utilities, rent, marketing, and other costs that are necessary to keep the business running.
Operating expenses are a necessary evil for any company, but they should be kept to a minimum. If your operating expenses are too high, it's time to take a serious look at where your company is spending its money and whether or not it's worth it.
Operating expenses are also a good way to determine how much money your company is making. If your operating expenses are $100,000 and your sales are $1,000,000, your operating expenses are 10% of your sales.
If your operating expenses are $1,000,000 and your sales are $1,000,000, your operating expenses are 100% of your sales.
It can be difficult to calculate Operating Expenses as % of Sales directly inside of Xero; that's where Causal comes in.
Causal is a modelling tool which lets you build models on top of your Xero data. You simply connect Causal to your Xero account, and then you can build formulae in Causal to calculate your Operating Expenses as % of Sales.
Causal lets you build models effortlessly and share them with interactive, visual dashboards that everyone will understand.
In Causal, you build your models out of variables, which you can then link together in simple plain-English formulae to calculate metrics like Operating Expenses as % of Sales. This makes your models easy to understand and quick to build, so you can spend minutes, not days, on your models.
When you're done, you can share the link to your model with stakeholders. They'll be able to view your model's outputs in a visual dashboard, rather than a jumble of tabs and complex formulae. The dashboards are interactive, letting viewers tweak your assumptions to see how they affect the model's outputs.
Causal lets you add visuals in a single click, letting you plot out graphs and distributions for metrics like Operating Expenses as % of Sales.