💡 Finance Term of the Week: Break-Even Point

How much do you need to earn before your business actually starts making a profit?

That’s your break-even point — the amount of revenue needed to cover both fixed and variable costs.

📊 Why it matters:

Knowing your break-even point helps you:

  • ✅ Set smarter sales goals
  • ✅ Price your products or services more strategically
  • ✅ Avoid growing your way into a loss

🧮 Simple example:

Let’s say your monthly:

  • Fixed Costs = 500,000
  • Selling Price per unit = 15,000
  • Variable Cost per unit = 5,000

➡️ Your Contribution Margin per unit = 10,000
➡️ Break-Even = 500,000 ÷ 10,000 = 50 units/month

Everything you sell after that? That’s your profit.

📈 Have you calculated your break-even point before?
👇 Drop a 📈 if you want help figuring it out.


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