GOVCONMay 29, 202609:32
How Overhead Costs Will Kill Your Small Business if You Don't Watch Them Carefully
0:0009:32
Featured guest
West Edwards
West Edwards joined Eric Coffie on this episode.
About this episode
Small business overhead costs are the silent killer that takes down more government contractors than slow sales ever could. In this episode, West Edwards breaks down exactly how to separate cost of goods from G&A expenses, calculate your real net profit, and spot the moment your overhead starts eating your business alive. If you have ever wondered why your revenue keeps climbing but your bank account does not, this conversation gives you the math to fix it.
In this episode, you'll learn
- Learn how to properly split cost of goods sold from general and administrative expenses across roofing, consulting, and service businesses Walk through real dollar examples on a 10 million dollar roofing company and a 1 million dollar consulting firm to see how net profit actually shapes out
- Discover why your overhead percentage explodes the moment your top line revenue drops and how to plan for it before it sinks you
- Understand when travel, software, and subcontractor costs belong in cost of goods versus when they belong in overhead
- Find out why putting yourself on payroll with a consistent paycheck makes you bankable when you go to borrow money for growth
Show notes & timestamps
- 0:00AI research assistant Mindy finds federal opportunities
- 0:38Federal Help Center podcast welcome and introduction
- 1:00Cost of goods versus administrative expenses explained clearly
- 1:57Net profit calculation from real revenue numbers
- 2:53Overhead can eat your business alive quickly
- 3:23Overhead percentages for consulting and service firms
- 6:46Revenue drops affect your overhead percentage badly
- 8:43Paying yourself a salary helps secure loans
