BusinessBasics
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Tool
Break-even Calculator
At which volume an offer pays for itself, and how far revenue and profit lie apart.
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Net price of a product, an hour or an order.
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Materials, subcontracting, commission: everything that arises with each unit.
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Rent, salaries, insurance, software, leasing.
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- Contribution margin per unit
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- Contribution margin ratio
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- Break-even point (volume)
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- Break-even point (revenue)
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- Revenue at your volume
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- Result at your volume
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- Margin of safety
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Simplified model with constant prices and costs. Taxes, financing and volume discounts are not taken into account.
What the break-even point tells you
The break-even point is the volume at which the contribution margins of all units sold fully cover the fixed costs. Below it the business makes a loss; above it every further unit adds its full contribution margin to profit.
Contribution margin as a lever
The contribution margin per unit is the price minus the variable costs. It shows how strongly price changes work: just a few euros more per unit often lower the break-even point considerably, while higher fixed costs push it up.
Margin of safety
The margin of safety shows by what percentage the planned volume may fall before the business drops below the break-even point. A larger margin means more room for weaker months.
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