Breakeven Calculations
31 Jul 2010 Leave a Comment
in Surviving the Recession Tags: breakeven calculation, Contribution margin, profit margins, variable costs
Each individual product sale can be thought of as a contribution to to the task of making an overall profit for the business, assuming that the cost of producing (or buying) the product is less than its selling price. But merely producing a product (for example at a cost of $5. and selling it for $10 does not ensure a profit for the business. Why is this?
How Important is breakeven analysis in operating profitably?
31 Jul 2010 Leave a Comment
in Uncategorized Tags: breakeven analytics, cost management, start up business profits, volume projections and profits
It is the most important and significant first step in operating profitably. Whether as a start up or an established business, knowing what level of volume you have to reach in order to generate a profit is crucial. Watch for more posts on how to prepare and manage a break even analysis of your business.
WORKING ‘IN’ THE BUSINESS OR ‘ON’ THE BUSINESS?
05 Jul 2010 Leave a Comment
in Uncategorized Tags: quality, ratio budgeting, sustainability, working 'on' the business
Do you work ‘in’ your business of ‘on’ your business? Managers working ‘in’ the business are busy all the time, with handling crises, desperately trying to keep the business afloat in hard times, handling delivery delays, canceled orders, and other problems.
What then is working ‘on’ the business? Here are some ideas: take time to plan for cutting costs as revenue declines through ratio budgeting, concentrate your efforts where they can pay off, using the 80X20 rule (otherwise known as the Pareto law), compete on quality, sustainability, and service, not on price.
There are other programs as well that we have developed for small business.
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