Glossary · Reading the business
Operating expense
In short
These are the costs a business incurs to run its day-to-day operations, like rent, salaries, utilities, and supplies. They directly impact profitability and cash flow.
What it means in a deal
When evaluating a business, scrutinize every operating expense on the Profit and Loss Statement. Look for
Related terms
Common questions about Operating expense
- How does business overhead expense insurance differ from key-person life insurance?
- What duration of post-acquisition operating expenses can working capital typically cover?
- Can I use an SBA 7(a) loan for general operating expenses, like payroll or rent?
- Can an SBA 7(a) loan be used for general operating expenses, like rent and utilities?
- Can I use an SBA 7(a) loan to cover operating expenses like payroll or rent?
- Can I use an SBA 7(a) loan to cover my business's daily operating expenses?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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