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Explanation: Selling, General, and Administrative (SG&A) Costs represent the expenses incurred by a company in its day-to-day operations, excluding costs directly associated with production or manufacturing. These costs encompass a broad range of activities essential for running the business, including sales and marketing expenses, administrative overhead, salaries, rent, utilities, and other general operating expenses. SG&A costs are necessary for supporting core business functions, managing operations, and facilitating growth.
Example: Maruti Suzuki reported SG&A costs of 2,140.60 crore rupees in FY23, reflecting the expenditures incurred by the company in sales, marketing, administrative, and other operational activities. These costs play a vital role in Maruti Suzuki’s business operations, supporting functions such as sales promotions, administrative management, employee salaries, and office expenses. Analyzing SG&A costs helps evaluate the efficiency of Maruti Suzuki’s operating expenses and its ability to manage overhead while sustaining profitability and competitiveness in the automotive industry.
You can view the quarterly and annual SGA Costs for any company on Radar under Total Assets in the Quarterly Results and Yearly P/L sections.