The Break Even Analysis Program is designed for startup and existing
businesses who need to reevaluate their price points, or who are
thinking of adding a new product or service. This process determines
what the breakeven point is, and what it will take to achieve
profitability and a reasonable profit margin. It also helps determine
whether or not the situation is viable. There are three determining
factors analyzed in this business analysis program: any associated
expenses, tentative price points, and quantity.
• Prove Viability
• Determine Break Even
• Establish Price Points
In this example, it took careful planning to get the right balance between pricing and quantity sold to coincide with all of the associated expenses; as you’ll see, the end result proved to be very viable and profitable.
In this example, the first bar chart displays the business revenue streams and tentative price points. The second chart displays the forecasted quantity, while the third displays the forecasted annual business revenue totals in each category.