Indirect costs are general business and administration expenses that aren’t directly linked to making products or delivering services. They’re the opposite of direct costs.
An indirect cost is money a business spends even when it’s not selling goods or delivering services.
While it’s relatively simple to pick apart all the direct costs that go into delivering products or services, indirect costs can sometimes be hidden. It’s important to identify them, understand them, and have a plan for funding them. You will need a sales and pricing strategy that can pay for everything.
A cost is either indirect or direct. It can’t be both.
Direct costs represent the money that goes into creating and delivering products or services to customers. Indirect costs are all the other background expenses involved with running the business.