Despite the fact that the business is organized for profit, often unpredictable market or the lack of management efficiency translate into losses for the company.This situation may be called disastrous, especially for beginners business because losses mean the loss of the investor's own money, which is always painful.The reluctance to part with their own means, and explains the attention that managers now tend to have a loss.You could even say that avoiding hitting us in the "negative zone" is a top priority of its product policy, as the main instrument of this policy is to calculate the break-even point.
Despite the great importance that the breakeven point is in management decisions, the calculation of the break-even point is carried out quite simply.All you need to do - is to divide your expenses into fixed and variable.By continuing customary include all expenses that are not related to increase or decrease the volume of your sales.What could it be?In fact, the spectrum of fixed costs is rather wide.It also rents for office use, and obsolescence of equipment and the salaries of the manager and the costs associated with the payment of the loan.We can say that these costs are "hanging" on the company, and if it will not sell, it will certainly carry out the calculation of damages.
The variables include all the costs that are directly related to the sales.This, of course, the cost of raw materials, as well as the payment of commissions to sellers, and the costs associated with the transportation of finished products.By all the rules of logic similar costs per unit product must be less than its price.Thus, the more you sell, the greater the costs, but also the greater the profit.
After you split the cost of the group can be made directly to the calculation of breakeven point.To do this, all your fixed costs divide by income from sales per unit minus variable costs of its production and sales.For example, the product costs 100 rubles, and the raw materials, wages agents, etc.account for 60 rubles.Then the sale of each unit of product will allow to repay the fixed costs 40 rubles.Suppose they are equal 4,000 rubles.In that case, you need to produce and sell 100 units so your profit is equal to zero.This is the break-even point.
breakeven calculation can also be done in monetary terms.Multiply the result obtained earlier in the price and we know that we have to get 10,000 rubles income to reach break-even point.
on the figures obtained in the future should be guided to plan sales.Of course, it is desirable that in your plans featured figure is significantly higher than the breakeven point.It is not a planned quantity, it is the lowest level, below which the company has no right to go down.If you want to calculate a target value of sales, in the calculations add to the fixed costs and expected profits.The result will be your expected sales.
Calculation of break-even point, among other things, to determine the financial stability of the campaign.If fixed costs constitute a large part of the costs, such a business is more risky, but at the same time it is a potentially more profitable while building sales.However, note that a business with high fixed costs should keep the sales level is significantly greater than the break-even point, otherwise unpleasant consequences can not be avoided.
