At the end of this exercise you will be able to determine how many units of ONE product a company needs to sell in order to breakeven over a time period of your selection.

Select the Company / Product
(for the purposes of this exercise we will assume this is the ONE and ONLY product this company sells)
What does the company sell this product for?
(what do the company’s customers pay to purchase this product)
Reference for selling price:

What does it cost the company to make this product?
(what does the company pay its suppliers to purchase the parts needed to make the product)
Reference for cost of goods sold:


CONTRIBUTION MARGIN PER UNIT
Source Variable Per Unit
Discovered above Selling price $
Discovered above Cost of goods sold $
Calculated Contribution margin $

On an annual basis, you also need to cover the following costs (you can select, from your research, the actual $ amounts, if available). These are figures based on your best estimation of what you would have to pay for the following expenses:

Rent How many units do you need to sell, on an annual basis, to breakeven (show your calculations)?
Reference for rent:
Staffing (assume you hire 3 employees)
Reference for staffing:
Advertising
Reference for advertising:
Total $

Determine the profit you would like to make, on an annual basis. $