It separates you from the point of losing money to making money. Your coffee shop break-even point is an important financial finish line. Why is knowing your break-even point important? When you reach your break-even point, the operations of your business have covered your fixed and variable costs.Ĭonsider the break-even point graphic below: Anything above your break-even point constitutes a profit. Anything below your break-even point and you are not turning a profit. Your coffee shop break-even point is the moment in time where your total costs are equal to your revenue. In this post, we will give you a brief overview of calculating your coffee shop break-even point, why it's important, and how you can use it to make better decisions that impact your coffee shop's financial health and profitability. This is especially true if you have decided to start a coffee shop from scratch and no available data exists. One of the most challenging aspects of starting any business, including a coffee shop, is developing a budget and financial forecast that estimates your profitability. That special moment is called your break-even point. To make money, you got to spend money, right?īut when does spending money turn into actually making money? Calculating Your Coffee Shop Break-Even Point
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