The term "cost structure" refers to the way in which a company incurs and allocates its expenses. It is an analysis of all the costs associated with running a business, including fixed costs, variable costs, direct costs, and indirect costs. Understanding your cost structure can help you make informed decisions about pricing strategies, operational efficiency, and overall profitability. The breakdown of these costs allows companies to identify areas where they may be able to reduce expenses or increase revenue in order to optimize their financial performance.