Break-even point: how to understand that the business will be profitable
Posted: Wed Feb 12, 2025 9:40 am
Almost every manager sets a goal before opening a new business - to quickly recoup investments and start making a profit. The break-even point can help get closer to this goal.
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In other words, the break-even point is one of the most important indicators that demonstrates:
how profitable will the company be given the given parameters;
What is the plan and what needs to be done to break even and generate income.
In this article, we will take a closer look at the concept of "break-even point". We georgia phone number list will analyze why it needs to be calculated, how to do it, what parameters and possibilities should be known and taken into account. We will learn how to build a break-even point graph and use it. In the end, we will consider how to analyze the break-even point to get the correct result.
What is the break-even point and the purposes of its calculation
The break-even point (BEP) is a certain volume of sales of goods or services at which the enterprise's income is equal to all its costs. The break-even point is more like a kind of threshold. Additional sales above this threshold allow you to make a profit. For entrepreneurs, understanding this indicator and taking it into account are essential elements of business management.
You are reading the magazine Compass - a messenger for effective and safe teamwork.
Learn more about Compass
In other words, the break-even point is one of the most important indicators that demonstrates:
how profitable will the company be given the given parameters;
What is the plan and what needs to be done to break even and generate income.
In this article, we will take a closer look at the concept of "break-even point". We georgia phone number list will analyze why it needs to be calculated, how to do it, what parameters and possibilities should be known and taken into account. We will learn how to build a break-even point graph and use it. In the end, we will consider how to analyze the break-even point to get the correct result.
What is the break-even point and the purposes of its calculation
The break-even point (BEP) is a certain volume of sales of goods or services at which the enterprise's income is equal to all its costs. The break-even point is more like a kind of threshold. Additional sales above this threshold allow you to make a profit. For entrepreneurs, understanding this indicator and taking it into account are essential elements of business management.