What is meant by company overhead?

Company overhead refers to the general expenses that are necessary for the overall operation of a business, but are not directly tied to a specific project or service. This includes costs such as rent, utilities, administrative staff salaries, office supplies, and other expenses that support the daily functioning of the business as a whole. Understanding these costs is crucial for contractors as they factor into pricing and budgeting for projects, ultimately impacting profitability.

While expenses related to project completion, marketing and advertising costs, and employee salaries specific to construction projects are important elements in the overall financial picture, they do not encapsulate the broader category of overhead. Overhead represents the supportive foundation on which a company operates, allowing it to function and serve its clients effectively.