{"id":999978833,"date":"2025-10-06T17:25:54","date_gmt":"2025-10-06T10:25:54","guid":{"rendered":"https:\/\/bizzi.vn\/?p=999978833"},"modified":"2026-06-09T13:48:41","modified_gmt":"2026-06-09T06:48:41","slug":"what-are-the-operating-costs","status":"publish","type":"post","link":"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/","title":{"rendered":"What is Operating Cost: Classification and Effective Optimization Strategy"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">What are operating costs and why do they play such an important role in a business? Financial experts say that good cost control helps increase profits, optimize resources, and improve a business&#039;s ability to withstand risks.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Let&#039;s join Bizzi to learn more about what operating costs are, their roles and how to optimize operating costs in the current volatile economic context.<\/span><\/p>\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_80 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Index<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewbox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewbox=\"0 0 24 24\" version=\"1.2\" baseprofile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/#Chi_Phi_Van_Hanh_la_gi_Vai_tro_cua_Operating_Cost\" >What is Operating Cost? The Role of Operating Cost<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/#Tam_quan_trong_cua_chi_phi_van_hanh_trong_doanh_nghiep\" >The Importance of Operating Costs in Business<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/#Phan_loai_chi_phi_van_hanh_trong_doanh_nghiep_Co_dinh_va_Bien_doi\" >Classification of operating costs in business: Fixed and Variable\u00a0<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/#Chi_phi_Co_dinh_Fixed_Costs\" >Fixed Costs<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/#Chi_phi_Bien_doi_Variable_Costs\" >Variable Costs<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/#Bang_so_sanh_Chi_phi_Co_dinh_va_Bien_doi\" >Fixed and Variable Cost Comparison Table\u00a0<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/#Cach_Tinh_va_Hach_Toan_Chi_Phi_Van_hanh_Hieu_Qua\" >How to Calculate and Account for Effective Operating Costs<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/#Cong_thuc_co_ban_theo_quan_tri_chi_phi\" >Basic formula (according to cost management)<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/#Chi_phi_van_hanh_tren_bao_cao_tai_chinh\" >Operating costs on financial statements<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/#Chien_luoc_toi_uu_hoa_chi_phi_van_hanh_la_gi\" >What is the operating cost optimization strategy?<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/#Ung_dung_cong_nghe_Chia_khoa_giam_chi_phi_van_hanh\" >Technology application: The key to reducing operating costs<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/#Ra_soat_va_cai_tien_quy_trinh_van_hanh\" >Review and improve operating procedures<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-13\" href=\"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/#Cac_cau_hoi_thuong_gap_ve_chi_phi_van_hanh_la_gi\" >What are the frequently asked questions about operating costs?<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-14\" href=\"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/#Chi_phi_van_hanh_chiem_bao_nhieu_doanh_thu_la_hop_ly\" >How much of the operating cost is reasonable for 1.3T of revenue?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-15\" href=\"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/#Doanh_nghiep_nho_nen_kiem_soat_chi_phi_van_hanh_the_nao\" >How should small businesses control operating costs?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-16\" href=\"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/#Chi_phi_van_hanh_co_duoc_khau_tru_thue_khong\" >Are operating costs tax deductible?<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-17\" href=\"https:\/\/bizzi.vn\/en\/what-are-the-operating-costs\/#Ket_luan\" >Conclude<\/a><\/li><\/ul><\/nav><\/div>\n<h2><span class=\"ez-toc-section\" id=\"Chi_Phi_Van_Hanh_la_gi_Vai_tro_cua_Operating_Cost\"><\/span><b>What is Operating Cost? The Role of Operating Cost<\/b><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><b>Operating Cost<\/b><span style=\"font-weight: 400;\"> are all expenses necessary for a business to maintain its daily operations, except for the cost of direct materials and direct labor (included in the cost of goods sold).<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This term is often used in parallel or interchangeably with a number of similar concepts such as <\/span><b>Operating Expenses (Opex)<\/b><span style=\"font-weight: 400;\"> good <\/span><b>Overhead Cost<\/b><span style=\"font-weight: 400;\">However, there are still certain differences between them in terms of scope and purpose of use.<\/span><\/p>\n<figure id=\"attachment_999978834\" aria-describedby=\"caption-attachment-999978834\" style=\"width: 1024px\" class=\"wp-caption aligncenter\"><img fetchpriority=\"high\" decoding=\"async\" class=\"wp-image-999978834 size-full\" src=\"https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-1.jpeg\" alt=\"What are the operating costs?\" width=\"1024\" height=\"291\" title=\"\" srcset=\"https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-1.jpeg 1024w, https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-1-300x85.jpeg 300w, https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-1-768x218.jpeg 768w, https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-1-18x5.jpeg 18w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><figcaption id=\"caption-attachment-999978834\" class=\"wp-caption-text\">Operating Costs are all expenses necessary for a business to maintain its daily operations, except for direct materials and direct labor costs (included in cost of goods sold).<\/figcaption><\/figure>\n<p><b>Explanation of related terms<\/b><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Operating Cost<\/b><span style=\"font-weight: 400;\"> \u2013 general term for operating costs.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Operating Expenses (Opex)<\/b><span style=\"font-weight: 400;\"> \u2013 focus on operating costs other than cost of goods sold, e.g. selling and administrative costs.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Overhead Cost<\/b><span style=\"font-weight: 400;\"> \u2013 indirect costs, not directly related to the product (e.g. office rent, electricity and water, depreciation).<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Create a comparison table of operating cost, operating expense, overhead cost (<\/span><b>Unique features:<\/b><span style=\"font-weight: 400;\"> Create a comparison table of terms to increase clarity and reduce confusion. <\/span><b>Cost of Retrieval<\/b><span style=\"font-weight: 400;\">.)<\/span><\/p>\n<table>\n<tbody>\n<tr>\n<td><strong>Terminology<\/strong><\/td>\n<td><strong>Define<\/strong><\/td>\n<td><strong>Scope includes<\/strong><\/td>\n<td><strong>Distinguishing notes<\/strong><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Operating Cost<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Total cost required to operate the business<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Includes Opex and indirect manufacturing costs<\/span><\/td>\n<td><span style=\"font-weight: 400;\">The most comprehensive concept<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Operating Expenses (Opex)<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Recurring expenses in regular operations<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Administrative staff salaries, rent, software, marketing, etc.<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Excluding cost of goods sold (COGS)<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Overhead Cost<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Indirect costs, not associated with product manufacturing<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Electricity, water, maintenance, administration<\/span><\/td>\n<td><span style=\"font-weight: 400;\">As part of Operating Cost<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>Operating costs do not include direct materials or direct manufacturing labor \u2014 as these are included in cost of goods sold (COGS).<\/p>\n<p><span style=\"font-weight: 400;\">Correctly understanding and distinguishing these types of costs helps businesses avoid errors in calculating profits, building budgets and evaluating financial performance.<\/span><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Tam_quan_trong_cua_chi_phi_van_hanh_trong_doanh_nghiep\"><\/span><b>The Importance of Operating Costs in Business<\/b><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Operating costs are more than just a number on a financial statement \u2014 they are an indicator of the health of a business. Keeping operating costs under control helps organizations balance operational efficiency and profit growth.<\/p>\n<p><span style=\"font-weight: 400;\">Here are three key roles of operating costs:<\/span><\/p>\n<ul>\n<li aria-level=\"1\"><b>Control spending effectively<\/b><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">According to many studies, <\/span><b>More than 601,000 businesses fail in the first 3 years.<\/b><span style=\"font-weight: 400;\"> because of poor control of operating costs.<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\"> \u2192 Close monitoring helps avoid waste and detect unnecessary costs.<\/span><\/p>\n<ul>\n<li aria-level=\"1\"><b>Optimizing profits<\/b><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Reducing operating costs by 5\u201310% can double profits, especially for businesses with thin profit margins.<\/span><\/p>\n<ul>\n<li aria-level=\"1\"><b>Sustainable development platform<\/b><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Transparent operating costs help:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Easy to forecast cash flow.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Improve the ability to raise capital and attract investors.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Ensure business stability even in recession.<\/span><\/li>\n<\/ul>\n<h2><span class=\"ez-toc-section\" id=\"Phan_loai_chi_phi_van_hanh_trong_doanh_nghiep_Co_dinh_va_Bien_doi\"><\/span><b>Classification of operating costs in business: Fixed and Variable\u00a0<\/b><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">After understanding the definition of operating costs, let&#039;s learn about 2 typical classifications of operating costs in businesses.<\/span><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Chi_phi_Co_dinh_Fixed_Costs\"><\/span><b><a href=\"https:\/\/bizzi.vn\/chi-phi-co-dinh-la-gi\/\">Fixed Costs<\/a> (Fixed Costs)<\/b><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Fixed costs are expenses that do not change with output or activity levels over a given period of time. These expenses must be paid whether a business produces 0 or 10,000 units of a product.<\/span><\/p>\n<p><b>Common types of fixed costs:<\/b><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Renting premises: Office and factory rent \u2013 usually signed long-term contract, fixed monthly payment.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Fixed staff: Including management salary, administrative staff, accountant - paid monthly, regardless of product quantity.<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Salaries are often considered a variable cost, but in the context of financial management, managerial or administrative staff salaries are counted as fixed costs because they do not vary with output.<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Depreciation of fixed assets: Machinery, equipment, vehicles, ERP software \u2013 are allocated equally over the accounting period.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Administrative costs: Legal fees, audit fees, office insurance\u2026<\/span><\/li>\n<\/ul>\n<figure id=\"attachment_999978835\" aria-describedby=\"caption-attachment-999978835\" style=\"width: 571px\" class=\"wp-caption aligncenter\"><img decoding=\"async\" class=\"wp-image-999978835 size-full\" src=\"https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-2.png\" alt=\"What are the operating costs?\" width=\"571\" height=\"373\" title=\"\" srcset=\"https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-2.png 571w, https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-2-300x196.png 300w, https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-2-18x12.png 18w\" sizes=\"(max-width: 571px) 100vw, 571px\" \/><figcaption id=\"caption-attachment-999978835\" class=\"wp-caption-text\">Businesses need to balance fixed and variable costs to ensure stability while taking advantage of flexibility and optimizing ROI in each stage of marketing strategy.<\/figcaption><\/figure>\n<h3><span class=\"ez-toc-section\" id=\"Chi_phi_Bien_doi_Variable_Costs\"><\/span><strong>Variable Costs<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Variable costs are expenses that increase or decrease with the level of activity or output. When more is produced, costs increase; when less is produced, costs decrease.<\/span><\/p>\n<p><b>Common types of variable costs:<\/b><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Direct materials: Production materials, packaging, accessories.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Utilities by usage: Electricity, water, gas \u2013 usually proportional to the number of production shifts.<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">Shipping \u2013 logistics: Delivery and warehouse fees are incurred based on the number of orders.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Seasonal labor: Wages paid to overtime workers and collaborators based on working hours.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">R&amp;D or flexible marketing costs: Costs for researching new products or seasonal advertising campaigns.<\/span><\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Bang_so_sanh_Chi_phi_Co_dinh_va_Bien_doi\"><\/span><strong>Fixed and Variable Cost Comparison Table\u00a0<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<table>\n<tbody>\n<tr>\n<td><b>Criteria<\/b><\/td>\n<td><b>Fixed Cost<\/b><\/td>\n<td><b>Variable Cost<\/b><\/td>\n<\/tr>\n<tr>\n<td><b>Define<\/b><\/td>\n<td><span style=\"font-weight: 400;\">Expenses <\/span><b>constant<\/b><span style=\"font-weight: 400;\"> according to campaign scale<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Expenses <\/span><b>flexible change<\/b><span style=\"font-weight: 400;\"> by efficiency or scale<\/span><\/td>\n<\/tr>\n<tr>\n<td><b>Characteristic<\/b><\/td>\n<td><span style=\"font-weight: 400;\">Stable, predictable, difficult to cut in the short term<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Flexible, increase or decrease according to marketing activities<\/span><\/td>\n<\/tr>\n<tr>\n<td><b>Specific examples<\/b><\/td>\n<td><span style=\"font-weight: 400;\">Marketing staff salary, office rental fee, CRM software<\/span><\/td>\n<td><span style=\"font-weight: 400;\">CPC\/CPA advertising, KOL\/KOC commission, POSM printing costs<\/span><\/td>\n<\/tr>\n<tr>\n<td><b>Advantage<\/b><\/td>\n<td><span style=\"font-weight: 400;\">Helps maintain stable and long-term operation<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Easy to control and adjust for performance<\/span><\/td>\n<\/tr>\n<tr>\n<td><b>Disadvantages<\/b><\/td>\n<td><span style=\"font-weight: 400;\">Cash flow pressure if revenue is low<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Can increase dramatically as campaign expands<\/span><\/td>\n<\/tr>\n<tr>\n<td><b>Role in strategy<\/b><\/td>\n<td><span style=\"font-weight: 400;\">Platform for maintaining marketing systems and building long-term capacity<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Fast growth lever, suitable for short-term campaigns<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><span style=\"font-weight: 400;\">Businesses need to balance fixed and variable costs to ensure stability while taking advantage of flexibility and optimizing ROI in each stage of marketing strategy.<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Cach_Tinh_va_Hach_Toan_Chi_Phi_Van_hanh_Hieu_Qua\"><\/span><strong>How to Calculate and Account for Effective Operating Costs<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">There are many ways to calculate operating costs, depending on the field and scale of operation. Below are 02 formulas for calculating operating costs according to cost management and financial reporting.<\/span><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Cong_thuc_co_ban_theo_quan_tri_chi_phi\"><\/span><b>Basic formula (according to cost management)<\/b><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><span style=\"font-weight: 400;\">This formula is suitable for internal management when a business wants to calculate the total operating costs in a period to analyze the break-even point.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Calculation: <\/span><b>Operating Cost = Variable Cost + Fixed Cost<\/b><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">In there:\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Fixed costs:<\/b><span style=\"font-weight: 400;\"> office rent, management staff salaries, depreciation, administrative costs.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>The variable costs:<\/b><span style=\"font-weight: 400;\"> raw materials, utilities, logistics, seasonal labor.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Chi_phi_van_hanh_tren_bao_cao_tai_chinh\"><\/span><b>Operating costs on financial statements<\/b><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Position on the income statement: Operating Expenses (OPEX) are presented after Net Revenue and Cost of Goods Sold (COGS), making up Gross Profit. Operating expenses are then deducted to calculate Operating Profit (EBIT).<\/span><\/p>\n<p><strong>Meaning:<\/strong><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Reflects the costs required to maintain and operate daily business operations (personnel, marketing, management, R&amp;D\u2026).<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Is an important indicator to evaluate management efficiency: how much a business spends to generate revenue.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Directly affects profitability and cash flow. A business with high revenue but poorly controlled operating costs can lead to low profits.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Operating costs are the \u201cbridge\u201d between revenue \u2013 cost of goods sold and actual profits, showing the health of internal management and the ability to optimize the enterprise\u2019s resources.<\/span><\/p>\n<figure id=\"attachment_999978837\" aria-describedby=\"caption-attachment-999978837\" style=\"width: 1723px\" class=\"wp-caption aligncenter\"><img decoding=\"async\" class=\"wp-image-999978837 size-full\" src=\"https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-3.jpg\" alt=\"What are the operating costs?\" width=\"1723\" height=\"808\" title=\"\" srcset=\"https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-3.jpg 1723w, https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-3-300x141.jpg 300w, https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-3-1024x480.jpg 1024w, https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-3-768x360.jpg 768w, https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-3-1536x720.jpg 1536w, https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-3-18x8.jpg 18w\" sizes=\"(max-width: 1723px) 100vw, 1723px\" \/><figcaption id=\"caption-attachment-999978837\" class=\"wp-caption-text\">Position on the income statement: Operating Expenses (OPEX) are presented after Net Revenue and Cost of Goods Sold (COGS), making up Gross Profit<\/figcaption><\/figure>\n<h2><span class=\"ez-toc-section\" id=\"Chien_luoc_toi_uu_hoa_chi_phi_van_hanh_la_gi\"><\/span><b>What is the operating cost optimization strategy?<\/b><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">In the context of Vietnamese enterprises increasingly under pressure on profits, operating costs become an important &quot;lever&quot; determining the ability to survive and develop. Not just stopping at cutting expenses, optimizing operating costs is a process. <\/span><b>reengineering the entire operating system \u2014 from internal processes to management tools<\/b><span style=\"font-weight: 400;\">.<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><\/p>\n<p><span style=\"font-weight: 400;\">From the perspective of <\/span><b>Bizzi.vn<\/b><span style=\"font-weight: 400;\">, businesses can deploy optimal strategies based on two main pillars: <\/span><b>Automation technology<\/b><span style=\"font-weight: 400;\"> and <\/span><b>Improve operating procedures<\/b><span style=\"font-weight: 400;\">.<\/span><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Ung_dung_cong_nghe_Chia_khoa_giam_chi_phi_van_hanh\"><\/span><b>Technology application: The key to reducing operating costs<\/b><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><span style=\"font-weight: 400;\">When financial and accounting processes are still dependent on humans and manual processing, businesses not only lose time but also face the risk of errors, data loss and lack of transparency.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Financial and accounting process automation platforms such as <\/span><b>Bizzi.vn<\/b><span style=\"font-weight: 400;\"> Bring about a quantum leap in cost management thanks to:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Automate invoice and document processing<\/b><span style=\"font-weight: 400;\">, reducing manual data entry time by up to 80%.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Digitize the spending approval process<\/b><span style=\"font-weight: 400;\">, helping managers control budgets in real time.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Real-time budget control:<\/b><span style=\"font-weight: 400;\"> Bizzi.vn&#039;s system helps administrators track each expense by department, project, or supplier, ensuring spending is always within budget.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Seamless integration with ERP<\/b><span style=\"font-weight: 400;\"> (SAP, Oracle, Netsuite\u2026), ensuring smooth data flow without hidden costs.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Automated report generation &amp; cost trend analysis:<\/b><span style=\"font-weight: 400;\"> Support leaders to make faster decisions, based on transparent and continuously updated data.<\/span><\/li>\n<\/ul>\n<p>This is proof that applying technology not only helps save human resources, but also reduces the risk of errors - which is the cause of cost loss. Bizzi.vn is not only automation software but also a comprehensive financial management platform, helping businesses transform cost management from reactive to proactive, thereby improving operational efficiency and profitability.<\/p>\n<figure id=\"attachment_999978838\" aria-describedby=\"caption-attachment-999978838\" style=\"width: 2048px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-999978838 size-full\" src=\"https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-4.png\" alt=\"What are the operating costs? 4\" width=\"2048\" height=\"1330\" title=\"\" srcset=\"https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-4.png 2048w, https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-4-300x195.png 300w, https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-4-1024x665.png 1024w, https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-4-768x499.png 768w, https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-4-1536x998.png 1536w, https:\/\/bizzi.vn\/wp-content\/uploads\/2025\/10\/chi-phi-van-hanh-la-gi-4-18x12.png 18w\" sizes=\"(max-width: 2048px) 100vw, 2048px\" \/><figcaption id=\"caption-attachment-999978838\" class=\"wp-caption-text\">Bizzi supports real-time cost reconciliation and management against policies and budgets.<\/figcaption><\/figure>\n<h3><span class=\"ez-toc-section\" id=\"Ra_soat_va_cai_tien_quy_trinh_van_hanh\"><\/span><b>Review and improve operating procedures<\/b><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Along with technology, continuous review and improvement of processes is also an important strategy. Many organizations waste budgets not because they spend too much, but because their processes are cumbersome, overlapping, and lack control over workflow.<\/p>\n<p><span style=\"font-weight: 400;\">Businesses can apply the following methods:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Periodic cost review<span style=\"font-weight: 400;\"> to eliminate non-value adding items.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Optimizing resources<span style=\"font-weight: 400;\"> through flexible working models (hybrid\/remote).<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\">Process improvement according to the Pareto principle (80\/20):<span style=\"font-weight: 400;\"> Focus on 20% customers or processes that deliver 80% value, thereby allocating resources appropriately.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Combining both technology (Bizzi.vn) and lean management methods, businesses not only cut operating costs but also improve overall performance, creating a sustainable foundation for long-term growth.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Bizzi is a financial and accounting automation platform that acts as an AI assistant for accountants, helping businesses process invoices, manage expenses, control budgets, and automate expense approval processes efficiently, using AI and RPA technology to process invoices automatically.\u00a0<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Cac_cau_hoi_thuong_gap_ve_chi_phi_van_hanh_la_gi\"><\/span><b>What are the frequently asked questions about operating costs?<\/b><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Below is the FAQ (Frequently Asked Questions) about operating costs, answered briefly - clearly - easy to apply:<\/span><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Chi_phi_van_hanh_chiem_bao_nhieu_doanh_thu_la_hop_ly\"><\/span><b>How much of the operating cost is reasonable for 1.3T of revenue?<\/b><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>There is no absolute \u201cstandard\u201d number for every business, because the operating cost ratio depends on the business model, size, industry and stage of development. However, according to average financial reports:<\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Retail\/Trade: 15\u201325% revenue.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Production: 10\u201320% (since most of the cost is in the cost price).<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Service: 25\u201340% (by <a href=\"https:\/\/bizzi.vn\/5-chi-phi-nhan-su-vo-hinh-doanh-nghiep-can-cat-giam\/\">personnel costs<\/a> indirect accounts for a high proportion).<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">General rule: The lower the operating cost ratio \u2192 the higher the profit margin. Businesses should set KPIs to reduce operating costs by at least 5% per year.<\/span><\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Doanh_nghiep_nho_nen_kiem_soat_chi_phi_van_hanh_the_nao\"><\/span><b>How should small businesses control operating costs?<\/b><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><span style=\"font-weight: 400;\">For small businesses (SMEs), controlling operating costs is vital. An effective strategy should ensure <\/span><b>both economical and productive<\/b><span style=\"font-weight: 400;\">.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Create a detailed cost budget: Separate fixed and variable costs for close monitoring.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Regular Review: Check your monthly expenses to spot waste.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Prioritize technology solutions: Use <a href=\"https:\/\/bizzi.vn\/top-10-phan-mem-quan-ly-tai-chinh-doanh-nghiep\/\">business financial management software<\/a>, electronic invoices to reduce manual accounting costs.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Apply the 80\/20 principle: Focus on optimizing the &quot;heaviest&quot; expenses (e.g. premises, logistics).<\/span><\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Chi_phi_van_hanh_co_duoc_khau_tru_thue_khong\"><\/span><b>Are operating costs tax deductible?<\/b><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Yes, most reasonable, eligible operating expenses are deductible when calculating corporate income tax, if:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Have legal documents (electronic invoices, contracts, receipts).<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Direct costs of business operations.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Payment according to regulations (bank transfer for invoices &gt; 20 million).<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Note: Expenses that do not serve production and business activities, or exceed the limit (such as entertaining guests above the allowable ceiling) will not be deductible.<\/span><\/li>\n<\/ul>\n<h2><span class=\"ez-toc-section\" id=\"Ket_luan\"><\/span><b>Conclude<\/b><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Hopefully, through the information above, readers can better understand what operating costs are, their roles and how to calculate operating costs most accurately. Strictly controlling operating costs helps businesses easily forecast their budgets, avoiding the situation of &quot;bloating&quot; the apparatus when revenue increases rapidly. Technology is the key to reducing operating costs. In the context of businesses increasingly under pressure to optimize costs and improve performance, technology is the most important lever.<\/span><span style=\"font-weight: 400;\">Automation and digitalization not only help reduce costs but also create a transparent, standardized control system \u2013 the foundation for sustainable growth.<\/span><a href=\"https:\/\/bizzi.vn\"> <span style=\"font-weight: 400;\">Explore Bizzi.vn<\/span><\/a><span style=\"font-weight: 400;\"> See how top businesses optimize operating costs today.<\/span><\/p>","protected":false},"excerpt":{"rendered":"<p>What are operating costs and why do they play such an important role in business? Financial experts say that,\u2026<\/p>","protected":false},"author":56,"featured_media":999978836,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"content-type":"","inline_featured_image":false,"footnotes":""},"categories":[263],"tags":[],"class_list":["post-999978833","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-kien-thuc"],"acf":[],"_links":{"self":[{"href":"https:\/\/bizzi.vn\/en\/wp-json\/wp\/v2\/posts\/999978833","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bizzi.vn\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bizzi.vn\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bizzi.vn\/en\/wp-json\/wp\/v2\/users\/56"}],"replies":[{"embeddable":true,"href":"https:\/\/bizzi.vn\/en\/wp-json\/wp\/v2\/comments?post=999978833"}],"version-history":[{"count":2,"href":"https:\/\/bizzi.vn\/en\/wp-json\/wp\/v2\/posts\/999978833\/revisions"}],"predecessor-version":[{"id":999978840,"href":"https:\/\/bizzi.vn\/en\/wp-json\/wp\/v2\/posts\/999978833\/revisions\/999978840"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bizzi.vn\/en\/wp-json\/wp\/v2\/media\/999978836"}],"wp:attachment":[{"href":"https:\/\/bizzi.vn\/en\/wp-json\/wp\/v2\/media?parent=999978833"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bizzi.vn\/en\/wp-json\/wp\/v2\/categories?post=999978833"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bizzi.vn\/en\/wp-json\/wp\/v2\/tags?post=999978833"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}