What are Direct Selling Costs?

Direct selling costs include any expenditures made to secure a specific customer order. It is useful to track these expenditures in order to determine the profitability of individual customers. This analysis may convince managers to drop selected customers that are demonstrably unprofitable.

Direct selling costs do not include administrative expenses, facility costs, rent, or supervisory costs.

Examples of Direct Selling Costs

Examples of direct selling costs are advertising targeted at new customers, sales commissions, travel to and from customer locations, and order processing costs.