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What is a 'Break Even' amount?
The Break Even amount equates to the total value of job/sales income your business requires to complete, invoice and be paid for to just keep the business alive; or 'break even' from a financial perspective.
This number does not include a 'net profit' amount.

What numbers do you need to know to calculate your break even point?
1. The total amount to cover Overheads/Operating/Fixed Costs for a set period. Either per month/year. Fixed costs are defined as the expenses you have even if you don’t sell a single product/service.
Don’t worry about getting this exactly right. A good estimate is usually good enough.
2. The Gross Profit margin (%) that you business keeps after paying the associated costs for delivering a job/project.
These costs often include materials, direct labour for the work you are doing, sub contractors (external labour/skills), equipment hire, delivery costs, etc.

The Break Even Equation
Break Even = Fixed Overhead Amount/Gross Profit Margin %

How to use this tool
1. Enter the information for the Current Situation into the orange textbox and first slider. This will calculate the current Breakeven amount.
2. Enter the Change expected into the next two sliders. This can be either an increase or decrease (-). This will calculate the New Breakeven and Breakeven Difference.
Enter information using Orange Sliders and TextBoxes.
Fixed Overhead:
Gross Profit Margin %:
Break Even:


Changes
If my Overheads change by %:
New Fixed Overhead:
If my Gross Profit changes by %:
New Gross Profit Margin:


Difference
New Breakeven:
Difference:
Ways to keep your break even point as low as possible, whilst maintaining quality. Even when you are growing.
1. Monitor your break even regularly. At least every 3-months, if not more often. What gets measured is easier to manage.
2. Know what your current gross profit margin is an look for ways to improve it 1% at a time.
3. Know what your current fixed overheads are and look for ways to reduce or maintain them as the year progresses.

Ways to improve your gross profit margin
1. Increase your prices
2. Get the best price for quality materials
3. Improve labour efficiency

For additional support contact our PROTRADE United team ph 1300 767 774

What our clients are saying about us

Over the past 20 years we have helped transform over 3900 trade & construction businesses. Below are some examples of how we have helped transformed businesses just like yours.

MCAULIFFIE PAINTING

From tradesmen to professionals of their trade

Targeting their ideal client and winning profitable work
Learn how McAuliffe Painting scaled their business and started attracting their ideal clients to their business with the help of PROTRADE United.

DAWSON ELECTRIC

Electrical company 3x profit

Learn how Brisbane based electrical company Dawson Electric has tripled their profits within 2 years of commencing work with PROTRADE United.

We would love to assist you with your questions and enquiries about business.

Please choose the contact method that suits you from the options below or simply fill out our contact form…

Call us on
1300 767 774
Email us at
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Mail us at
GPO Box 950, Brisbane 4001
Visit our Head Office at
Level 7, 757 Ann St Fortitude Valley, QLD 4006
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