Operating Expenses

SG&A, opposite of COGS, includes all costs incurred in operating the business that are not directly related to the production and storage of a company's goods.

This includes R&D expenses, sales and marketing costs.

Marketing and Selling Expense: Costs related to promoting and selling products or services, including advertising, sales staff salaries, and promotional materials.

For instance, H&M would have higher marketing and selling expenses because fashion retail requires substantial advertising, brand promotion, and merchandising to drive consumer interest and stay competitive in the fashion industry, while Walmart (a grocery retailer) typically has more modest marketing needs.

• ! If an expense can be eliminated without affecting the production and storage of the company’s products, then it's an operating expense and not part of COGS.