In­crease your busi­ness prof­its by know­ing your break-even point

Serve Daily - - FOSTERING INNOVATION - By Robyn Kimpton

Is your busi­ness break­ing even? Did you know that 95 per­cent of all new busi­nesses fail in the first five years? The rea­son most of these fail is due to ac­count­ing is­sues. Busi­ness own­ers want and need to know how much rev­enue they need to bring in each month in or­der to pay their bills. One of your most im­por­tant tools to help you with this is the Break-Even Re­port. With my clients, I’ve found that the right re­ports give them the info they need to make the right changes to make their busi­nesses run bet­ter and in­crease their prof­its in the process. A break-even point tells where you be­come prof­itable. The cal­cu­la­tion to do this is Break Even = (Fixed Ex­penses + Dis­cre­tionary Ex­penses) ÷ Gross Profit Per­cent.

A good book­keeper can save com­pa­nies more money than they cost. The cost is re­ally pen­nies on the dol­lar. Through the break-even anal­y­sis, I per­son­ally helped a busi­ness in­crease its sales by al­most 25 per­cent as well as lower its costs. A good book­keeper can do the same for you.

You can go to my web­site to cal­cu­late your break even at www.Gran­iteBook­keep­ First, print a one-year Profit and Loss State­ment. If you have fixed Owner Draws, add them to your Fixed Ex­penses. On my web­site, click on the Cal­cu­la­tion link or go to the Cal­cu­la­tion page. If you have any ques­tions, please feel free to con­tact me at Robyn@Gran­iteBook­keep­ Happy in­creased prof­its!

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