Business Essentials

### Breakeven Analysis

### Gross Margin

### Cost Markup

### Set Price Using Markup

### Return on Investment (ROI)

Sales and Marketing

### Convert Leads to Sales

SaaS Metrics

### Customer Acquistion Cost (CAC)

### Customer Churn

### Customer Lifetime Value (LTV)

### Monthly Recurring Revenue (MRR)

### SaaS Company Viability

Sales and Marketing

SaaS Metrics

In its simplest form, the breakeven point tells you how many units of goods you need to sell to cover all of your fixed and variable costs.

Breakeven occurs when your business is neither making nor losing money.

Determine the following three things:

- 1. Your fixed costs.
- 2. The average variables costs for all items you sell. If you want to determine the breakeven for a single item type where the costs are the same, then determine the actual variable costs for that item.
- 3. Determine the average unit price for all items you sell. Again, if you are doing a breakeven analysis on a single item where the price doesn't vary, then find the actual unit price.

Since the variable costs are often not the same for every unit, you can think of the variables costs as an average for the breakeven analysis. At breakeven

Determining the number of units that needs to be sold to arrive at breakeven gives you

2000 units = $6000/($4-$1)

It's easy to calculate breakeven price as well as breakeven units as we did in the example above. Since we know that 2000 units is breakeven and the price per unit is $4, the breakeven price is simply

$8000 = 2000 x $4.

To calculate gross margin percent: