Selling, General & Administrative Expenses is the sum of all selling expenses and all general and administrative expenses
Items commonly included in SG&A are not directly attributable to production. Examples of SG&A include employee salaries, commission bonuses, pension costs, marketing costs, insurance, rent and utilities, and maintenance.
While cost of sales are easily controlled, SG&A expenses are more difficult to manipulate. A company can keep its cost of sales down by limiting raw material purchase and adjusting its manufacture/service-production during a given accounting period. SG&A expenses are oftentimes fixed recurring expenses, and thus not as easily adjustable (i.e. payroll expense).
Investors look to SG&A as a measure of how efficiently a company is using its money. A company maintaining an SG&A that is a high percentage of revenue relative to other companies in its sub-industry would may indicate an inability to adapt to market downturns, as SG&A expenses are not easily changed in a short period of time (money being tied up in things like salary and office rent).