What is your break-even point? How can you put this tool to work for you?
This exercise helps businesses maintain profitability and come up with a pre-emptive strike to cut costs, processes or product lines, in the event they start generating losses.
The break-even level is the minimum level of activity or sales level, below which, the company is losing money and above which, the company has super profits. It can be defined as the point where the total expenses equal the total revenue which means there is no net profit or loss.
With changes in cost structure, break-even levels keep changing. However, we make it our business to evaluate every process and the company as a whole and provide constant feedback to our clients so that they can monitor their activities.