Variable Expenses

Variable Expenses

Variable Expenses Jonathan Poland

Variable expenses are expenses that can fluctuate over time, making them more difficult to budget and predict than fixed expenses. Fixed expenses are those that remain constant and predictable, and are often used as the basis for budgeting and planning. Examples of variable expenses might include utilities, transportation costs, or raw materials, while examples of fixed expenses might include rent or salaries. By understanding the difference between fixed and variable expenses, organizations can better manage their resources and make more informed decisions.

In the context of business, a variable expense is most commonly an expense that rises with production levels. Variable expenses also include strategic initiatives such as a project that is expensed. Variable expenses can be contrasted with overhead such as the cost of your HR team that doesn’t change with your business volumes or strategy. Some types of taxes such as property tax are typically a fixed expense. Income tax tends to be highly variable according to income and expenses.

  • Advertising
  • Bad Debt Expense
  • Commissions
  • Components
  • Consulting
  • Cost of Goods Sold
  • Delivery
  • Direct Labor
  • Electricity
  • Foreign Exchange Loss
  • Freight Inventory
  • Marketing Expenses
  • Materials
  • Professional Fees
  • Strategic Initiatives
  • Subcontracts
  • Supplies
  • Taxes
  • Travel Expenses

Personal variable expenses includes costs that are discretionary, unpredictable, one-time, unusual or that go up and down according to usage. These can be budgeted for with categories such as contingency and discretionary. In many cases, it is possible to convert a variable cost into a fixed cost. For example, insurance that covers medicine. It is also common for services to offer fixed rate pricing such as a streaming media service that offers entertainment for a fixed monthly fee.

  • Appliances
  • Bedding
  • Clothing
  • Disasters (e.g. Flood Damage)
  • Electronics
  • Energy & Fuel
  • Entertainment
  • Eye Care
  • Food
  • Footwear
  • Furniture
  • Haircare
  • Home Furnishings
  • Internet & Communications
  • Luxuries
  • Medicine
  • Out-of-pocket Medical
  • Repair
  • Restaurants
  • Toiletries
  • Travel
  • Utilities
  • Vacations

Learn More…

Serviceable Market Jonathan Poland

Serviceable Market

Serviceable market is the part of the total addressable market that can actually be reached.

Labor Specialization Jonathan Poland

Labor Specialization

Specialization of labor involves dividing work into specific roles or tasks, with…

Business Experience Jonathan Poland

Business Experience

Business experience refers to any work experience, including paid employment, freelance work,…

Abundance Mentality Jonathan Poland

Abundance Mentality

Abundance mentality is the belief that there is enough for everyone, and…

Product Experience Jonathan Poland

Product Experience

Product experience refers to the overall value that a product or service…

White Labeling Jonathan Poland

White Labeling

White label refers to products or services that are produced and designed…

Market Saturation Jonathan Poland

Market Saturation

Market saturation refers to a state in which a particular market is…

Scarcity Marketing Jonathan Poland

Scarcity Marketing

Scarcity marketing is a strategy that involves creating a perception of limited…

Soft Launch Jonathan Poland

Soft Launch

A soft launch is a product launch that is limited in scope,…

Jonathan Poland © 2023

Search the Database

Over 1,000 posts on topics ranging from strategy to operations, innovation to finance, technology to risk and much more…

Remarketing Jonathan Poland


Remarketing is a marketing strategy that involves targeting customers who have previously…

Big Picture Thinking Jonathan Poland

Big Picture Thinking

“The big picture” refers to the broadest possible perspective that can be…

Market Failure Jonathan Poland

Market Failure

Market failure is a situation in which the market does not produce…

Personal Data Jonathan Poland

Personal Data

Personal data is any information that can be used to identify an…

Process Automation Jonathan Poland

Process Automation

Introduction: Process automation refers to the use of information systems to automate…

Project Proposal Jonathan Poland

Project Proposal

A project proposal is a document that outlines a proposed project and…

Middlemen Jonathan Poland


A middleman is a person or organization that acts as an intermediary…

Agile Change Management Jonathan Poland

Agile Change Management

Agile change management is the practice of leading continuous delivery processes in…

Marketing Communications Jonathan Poland

Marketing Communications

Marketing communications refers to the various forms of communication that are utilized…