Business Tactics

FIGURE #l: BREAK EVEN ANALYSIS (Pricing Approach)

Overhead (monthly):

Rent and Utilities $400.00
Miscellaneous Overhead 200.00
(equipment, advertising,
inventory, etc.)

Total Overhead: $600.00/mo

Target Salary: $2000.00/mo

Revenue Goal: $2600.00/mo

This is how much money the class must generate for you to cover your expenses and to make the desired monthly income of $2000.00.

Assumptions Made

1. Assume you charge each student $30.00 per month.

$2600.00/$30.00 per student = 87 students necessary to attain revenue goal.

2. Assume you charge each student $60.00 per month.

$2600.00/$60.00 per student = 44 students necessary to attain revenue goal.

3. Assume you take the middle road and charge $45.00 per month.

$2600.00/$45.00 per student = 58 students to achieve your projected goal.

4. If you were to ignore salary for yourself, and simply wanted to cover your expenses...

At $60.00 per month, you would need $600.00/$60.00 or 10 students.

At $30.00 per month, you would need $600.00/$30.00 or 20 students.

At $45.00 per month, you would need $600.00/$45.00 or 15 students.