The Power of Breakeven Analysis
01 Feb 2023
CC1.2
There are only three paths to increase profits - spend less, charge more, or do more work. A breakeven analysis can help you determine which path will work best for you. Particularly in a changing economy, you need to make strategic decisions about growth. Learn how to create a breakeven analysis to help make crucial decisions. Play the “what-if” game to forecast the consequences of changes in overhead, margin, and sales volume. This session helps you understand how avoid the mistake of confusing the markup you charge with the margin you achieve. If you sell more, will you make more? If your overhead is 20% and your markup is 25%, can you make money? Session Objectives: · Use Excel® to create a breakeven forecasting tool · Analyze how changes in pricing structure can impact the bottom line · Determine the financial impact of slippage · Examine how to measure margins so you can price jobs with enough markup to cover overhead and create a profit
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