The Hackett Group® Finds SG&A Costs at a Five-Year High as 62% of US Companies Struggle to Control Spending Amid Slowing Revenue Growth

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[{"type":"text","content":"\nMedian SG&A cost ratio rose to 14.3%; leaders are turning to AI and agentic enterprise strategies to unlock sustainable cost advantages\n\n MIAMI--(BUSINESS WIRE)--\nThe Hackett Group, Inc. (NASDAQ: HCKT), a leading Gen AI consultancy and enterprise digital transformation firm, today announced new findings from its US SG&A Cost Study and Scorecard, revealing that selling, general and administrative (SG&A) costs have reached their highest point in five years. Median SG&A cost as a percentage of revenue increased from 13.7% to 14.3%, largely driven by slowing revenue growth.\nThis press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20251209972589/en/In the US SG&A Cost Study, The Hackett Group® compared the FY23 and FY24 financial performance of the 1,000 largest nonfinancial services companies in the United States to identify the degree to which organizations are optimizing SG&A costs. Our analysis segmented companies into four groups based on their year-over-year SG&A cost changes: 1. Cost cutters: Companies that reduced SG&A cost as a percentage of revenue and reduced absolute SG&A costs. 2. Inflation beaters: Companies that reduced SG&A costs as a percentage of revenue and contained the absolute costs increase below the inflation rate. 3. Ratio managers: Companies that reduced SG&A costs as a percentage of revenue but increased absolute costs by more than the inflation rate. 4. Cost growers: Companies whose SG&A costs increased as a percentage of revenue.\nThe study – based on an analysis of the 1,000 largest U.S.-headquartered public companies – found that 62% saw SG&A costs rise as a share of revenue, and 78% failed to keep cost growth below inflation, despite inflation dropping to 2.9%. Only 17.9% of companies reduced SG&A costs year over year, and just one-quarter of last year’s cost cutters sustained that performance. The Hackett Group’s analysis highlights a substantial seven-percentage-point performance gap between first-quartile and median companies.\n\n“Organizations face mounting pressure as revenue growth cools and complexity increases, but the data shows that traditional cost-cutting approaches are not enough,” said Murray Shevlin, principal, Benchmarking at The Hackett Group®. “Sustainable SG&A improvement requires companies to move beyond tactical measures and e...

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