![]() ![]() Write it all down, or even better, add it to a spreadsheet. Check all of your bank and credit card statements find every dollar that left your accounts. Look over the past year at every dollar the business has spent. How to calculate your break-even point and daily targets 1. Once you know your break-even point, you can feel confident that you know the financial state of your business, and not wonder if you’re going to be able to afford to pay bills, staff or invest in something new. It’s also an opportunity to look critically at all of your expenses. This allows you to plan for the future to meet all of your expenses, and hopefully make a profit. ![]() What makes a break-even calculation so useful is that it’s not just a report of what has happened in the past, it can be used as a tool to better understand your financial needs. It gives you a clear picture of what it costs to keep your business afloat, and how much money you would need to bring in for your business to be thriving. Why is your break-even point important?Īlthough you’ll probably have several different places where money comes in and goes out, and different reports that are tracking various bits and pieces, a break-even calculation brings all of these numbers into one place. To achieve this, you’ll need to know your break-even point, and this guide will teach you how to find this out, step-by-step. Your money coming in is probably not on the same schedule as your money going out, so you need a plan that will work all-year-round. It sounds easy right? But how do you know exactly how much money you’ll need to meet all of your expenses, and when exactly you’ll start making a profit? If you have more money coming in than going out – you’re making money. ![]()
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