Operating expenses (OPEX) are under the microscope in 2025, as Australian businesses face economic headwinds, shifting consumer demand, and a regulatory environment that’s evolving by the quarter. For many business owners and finance professionals, mastering OPEX isn’t just about cost-cutting—it’s a strategic imperative for survival and growth.
What Counts as Operating Expense in 2025?
Operating expenses represent the day-to-day costs required to keep a business running, excluding the direct costs of producing goods (COGS) and major capital investments. As of 2025, these typically include:
- Employee salaries and superannuation
- Office rent and utilities
- Marketing and advertising outlays
- Insurance premiums
- IT subscriptions and software licensing
- Depreciation of office equipment
- Professional fees (legal, accounting, consulting)
With the rise of hybrid work and digital transformation, Australian businesses are seeing a shift in the composition of their OPEX. For example, many SMEs have reduced their office footprint, channelling savings into cloud software and cybersecurity measures—a trend that’s expected to continue throughout 2025.
2025 Trends: Managing OPEX in a High-Cost Environment
This year, the economic landscape is demanding sharper focus on OPEX management. Here’s how businesses are responding:
- Rising Wages and Compliance Costs: The 2025 Fair Work Commission wage increase has pushed up payroll expenses for many sectors. Additionally, new ESG reporting requirements mean higher compliance and consulting costs for listed companies and large private firms.
- Remote Work Reshapes Spending: Hybrid work models have led to reduced spending on commercial leases but higher investments in IT infrastructure, software-as-a-service (SaaS) platforms, and staff wellbeing programs.
- Energy and Utilities: With energy prices still volatile and the government’s net zero transition policies in effect, businesses are incentivised to invest in energy-efficient upgrades—turning some OPEX into strategic investments for long-term savings.
- Automation and Outsourcing: Many companies are leveraging automation to streamline routine admin, payroll, and even customer service, converting fixed headcount costs into more flexible, variable OPEX.
For example, an Australian retailer that once spent heavily on in-store operations is now allocating more of its OPEX to e-commerce platforms and last-mile delivery partnerships, reflecting how consumer habits and technology are reshaping cost structures.
Strategies to Optimise Operating Expenses in 2025
With margins under pressure, here are actionable steps for managing OPEX:
- Perform a Line-by-Line Review: Analyse every expense category at least quarterly to identify inefficiencies or legacy costs that no longer deliver value.
- Negotiate Vendor Contracts: Leverage increased competition among SaaS and utility providers to renegotiate contracts or seek bundled discounts.
- Embrace Tech-Driven Solutions: Invest in automation tools for finance, HR, and customer engagement to reduce manual processes and error rates.
- Benchmark Internally and Externally: Compare OPEX ratios against industry peers and previous years to identify outliers.
- Incentivise Cost Awareness: Encourage teams to treat company money like their own by linking cost savings to performance bonuses or recognition programs.
Many businesses are also turning to virtual CFO services in 2025, gaining expert advice on OPEX optimisation without the full-time salary cost—a sign that flexible, outsourced models are gaining traction.
Conclusion: Don’t Let OPEX Drag Down Your 2025 Results
Operating expenses aren’t just a necessary evil—they’re a lever for agility and competitive edge. In 2025’s unpredictable market, businesses that proactively manage and optimise OPEX will have the resilience to seize opportunities and weather shocks. Now’s the time to review your expense structure, embrace digital tools, and make every dollar count.
