Operating Expense Ratio

Operating Expense Ratio is an indicator of how well a company is managing the ongoing costs of operating the business. It takes the operating expenditure (OPEX) and divides them by sales in a given period.

 

Operating Expense Ratio = (OPEX in period t / Sales Revenue in period t) x 100

 

This indicator is included in the book: Key Performance Indicators - the 75+ measures every manager needs to know, which contains an in-depth description of this KPI, as well as practical advice on data collection, calculations, target setting, and acutal usage.

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