Sometimes you have to pay salespeople, so you might have sales expense, and then the stuff like the corporate office and the CEO's salary, and you have to hire auditors and accountants and all of that.

Selling is things like, it could be the commissions that the salespeople get.

Sell, sell, sell.

I can't just put that in my pocket.

So as you could see, we still have the same cost of goods to manufacture the product as before, 33.

SG amp A that mean selling, general and administrative expenses.

I want to make a separate line for sales. So let's say sales, selling expenses is 200,000.

They both make 100,000 in revenue.

To produce those 3 million widgets for 1, it cost me maybe 0.30 a widget, or 0.33 a widget.

But this is, of course, an optimistic scenario. Let's think of other scenarios.

And their value proposition, as even they realized later, was pretty unclear.

So it'll sometimes be written as cost of sales or cost of goods sold.

Sold

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What do you sell?

I have all of this overhead expense and often times, on a regular income statement, it will be called selling, general and administrative, or overhead costs, or operating costs or something like that.

Accessories were laid out on the shelf for sale.

I want to start with this tiny product.

We call it a select opportunity .

Who owns Happy Landings Entertainment?

He's like, you know what, we have to match his prices.

My dad sells tractors.

But the growing dominance of the market economy, where the products of our intellectual labors are bought and sold, produced an unfortunate side effect.

This is the PC guy over here.

I'm a salesperson.

I had to break a machine open.

Our liquor license!

What's so awesome about a queensize futon sale?

This guy is a Bible salesman.

So let's take a look at a direct sales example.

In a physical channel, a direct sales force are sales people that work for you directly and typically sell directly to the end user.

We still needed a direct sales person but this time instead of them talking to every possible end user, they are actually talking to a few number of resellers.

And the reason why they're the sell side is because they're always selling you stuff.

And that's better than what you get out of treasury bonds.

So that's what sell side means.

So now they're in it together.

October is inventory time.

Anything from the trolley?

Cell phone salesman.

He could also be a Bible salesman.

He sold you the roofilin?

In this case, it would be 37.

But this time, we have resellers and the resellers don't work for us.

But remember, our costs were lower.

In fact, if you think about what happened during the dot com bubble, in the beginning of the 21st century is every startup executed like they were in an existing market.