Expense & Cost Management
Track operating expenses, cost of sales, and one-time vs recurring costs with flexible payment schedules.
Understanding the distinction between Cost of Sales and Operational Costs is fundamental to building an accurate financial model in ForezynPlan.
Cost of Sales (COGS)
Costs that vary directly with the volume of revenue you generate. Examples: cloud hosting costs that scale with customers, payment processing fees, raw materials, freelancer costs directly billed to client projects, fulfilment costs per order.
Operational Costs (OpEx)
Fixed or semi-fixed costs that you incur regardless of revenue volume. Examples: office rent, insurance, SaaS tools, marketing spend, management salaries, legal and accounting fees.
Why the distinction matters
ForezynPlan uses this split to calculate Gross Profit (Income minus Cost of Sales) separately from EBITDA (Gross Profit minus Employees minus Operational Costs). Gross Margin % is a key investor metric — getting the classification right ensures your reports are meaningful.
Variable overheads
Some costs sit between Cost of Sales and Operational Costs (e.g. a sales commission that varies with revenue but isn't COGS). You can use the '% of another component' driver on a Cost of Sales component to model this accurately.
Rule of thumb
Ask: 'Would this cost exist if we had zero revenue?' If yes — it's an Operational Cost. If it would disappear or shrink proportionally with zero revenue — it's Cost of Sales.