The break even analysis describes what the company must do in order to pay off initial costs, overhead and other start-up expenses and begin generating profits. This belongs in the financial projections section of your business plan. It is good to input a table showing revenues minus expenses which leads to profits. As seen in the description above, this particular company received profits in the second, third, fourth and fifth month but then incurred a loss in their 6th month due to operations which were more expensive then the revenues they brought in. However, the profits incurred in month 2 through month 5 were enough to cover this loss.
You should explain your break even analysis after showing the chart. You should describe what your initial costs are, why it will take the specified amount of time to break even and any additional assumptions you used to create your numbers. Furthermore, an explanation should be written about the cause of growth in sales. Illustrate what the company must do before it starts making sales including the equipment and supplies the company needs to purchase in order to reach this point.
The break even analysis can also be more descriptive showing sales from each revenue stream and every cost incurred.
PPM is the leading U.S. entrepreneurial firms that specialize in writing private placement memorandums (PPM) and linking investors with entrepreneurs.
Since 1999, the founders of PPM have provided professional business writing services, such as a PPM or business plan, to more than 2,000 businesses worldwide. Our company is considered to be the most cost effective, efficient consultants for private placement memorandum development in the United States. We are Wall Street’s, and by extension, New York’s private placement leaders.
PPM.co’s main service is the creation of private placement memorandum regulation d (Reg. d) documents. However, we offer much more. In case the entrepreneur needs additional services, such as a business plan, website, or additional legal work, PPM can create one pricing package for all required documentation or service. Because we simultaneously work with many companies both in and out of the U.S., the ability to adapt to the individual needs – as well as to regional and global demands – helps our clients save needed capital and time.