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Business Solutions JC: Breakeven Points, or should I even bother with thi...
Business Solutions JC: Breakeven Points, or should I even bother with thi...: "Hello fellow bloggers, well we are working on our business and came across a business problem you may have encountered. Whether something I ..."
Breakeven Points, or should I even bother with this?
Hello fellow bloggers, well we are working on our business and came across a business problem you may have encountered. Whether something I purchase will earn/save me enough revenue to justify it?
This is what's known as finding an item's Breakeven point. This is a situation where you want to find out how much you might have to sell to make a service worth it.
In this case we are considering hiring a blogger to write about our Videography business, SundayMorningFilms, we will suppose in this case that said blogger, might charge us an upfront fee, say $1,000 and then perhaps a marginal cost of $5 per blog. Lets say each blog or link that he posts that gets us a sale will get us $200 of revenue, how many jobs will we need to break even on his cost? The equation is $1,000/($200-$5) = $1,000/$195) = 5.12, thus it will take 5.12 wedding jobs to break even on this cost. *My assumption is that the blogging will generate sales, in this case I assume 20 posts will generate a job that might ex. pay $2,000, $4,000/20= $200.
This is what's known as finding an item's Breakeven point. This is a situation where you want to find out how much you might have to sell to make a service worth it.
In this case we are considering hiring a blogger to write about our Videography business, SundayMorningFilms, we will suppose in this case that said blogger, might charge us an upfront fee, say $1,000 and then perhaps a marginal cost of $5 per blog. Lets say each blog or link that he posts that gets us a sale will get us $200 of revenue, how many jobs will we need to break even on his cost? The equation is $1,000/($200-$5) = $1,000/$195) = 5.12, thus it will take 5.12 wedding jobs to break even on this cost. *My assumption is that the blogging will generate sales, in this case I assume 20 posts will generate a job that might ex. pay $2,000, $4,000/20= $200.
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