> ## Documentation Index
> Fetch the complete documentation index at: https://docs.spicom.co/llms.txt
> Use this file to discover all available pages before exploring further.

# Global Costs

> Learn how to configure your fixed monthly costs so Spicom can calculate your true profitability.

# Global Costs

Global Costs represent the **fixed expenses** your business pays every month — regardless of how many clients or contracts you have.\
Spicom uses them to calculate **your true margin**, your **break-even point**, and the cost allocation per contract.

<Callout type="info">
  global costs are essential for FP\&A accuracy.\
  Without them, margin calculations tend to be overestimated by 20% to 40%.
</Callout>

***

## Why Global Costs Matter

When a business only looks at contract revenue vs. staff cost, it misses a huge part of the financial reality.

Global Costs include:

* Software subscriptions
* Rent or coworking space
* Insurance
* Accounting
* Administration
* Tools, servers, infrastructure
* Company vehicles or equipment
* Any recurring monthly charge

These costs are **distributed across your contracts** to reveal the *actual* profitability of each one.

***

## Adding a Global Cost

To add a new cost:

1. Go to **Setup → Global Costs**
2. Click **Add Cost**
3. Fill in:
   * **Label** (e.g., “Google Workspace”, “Office rent”, “AWS”)
   * **Amount** (monthly cost in your currency)
   * **Category** (helps group them visually)
4. Save

<Callout type="tip">
  You can edit or delete any cost at any time.\
  Changes are instantly reflected in your margin calculations.
</Callout>

***

## Example

Let's say your company pays:

| Cost             | Amount  |
| ---------------- | ------- |
| Google Workspace | €60/mo  |
| Rent             | €850/mo |
| Tools & Software | €120/mo |
| Accounting       | €150/mo |

**Total Global Costs = €1,180 / month**

If you manage **4 active contracts**, each of them inherits **€295/month** of global cost allocation (pro-rata based on workload, unless overwritten by simulations or workforce share).

***

## How Spicom Uses Global Costs

Once entered, Global Costs impact:

#### Real margin

#### Break-even

Shows how much revenue your business must generate monthly to stay profitable.

#### Projections

Global Costs are spread over the next 12 months in your forecast.

#### What-If scenarios

When you simulate losing a client or increasing a contract value, Spicom automatically recalculates how fixed costs redistribute.

***

## Best Practices

* **Group similar costs together** for clarity
* If a cost is *yearly*, divide it by 12 (e.g., insurance)
* Don’t include one-off expenses
* Revisit this list every month or quarter

***

## Next Step

Continue with the setup:

[Workforce](/setup/workforce)\
[Import Contracts](/setup/import-contracts)