Frequently Asked Questions
What is break-even point?+
Break-even point is where total revenue equals total costs — you make zero profit or loss. Selling above this point generates profit.
What are fixed costs?+
Fixed costs stay the same regardless of how much you sell. Examples include rent, staff salaries, loan EMIs, and insurance.
What are variable costs?+
Variable costs change with each unit sold. Examples include raw materials, packaging, shipping, and sales commission.
What is contribution margin?+
Contribution margin is selling price minus variable cost per unit. It shows how much each sale contributes toward covering fixed costs.
How do I reduce my break-even point?+
Lower fixed costs (negotiate rent, reduce overheads), increase selling price, or reduce variable costs through bulk purchasing or process improvements.