The breakeven point (or point of return) is the minimum number of orders per day to cover all your costs. Knowing it is essential.
Step 1: List your monthly fixed costs related to delivery. Include rent, platform subscriptions, and equipment depreciation (tablets, printer, tickets).
Step 2: Calculate your average gross margin per order. Average basket - (raw materials + packaging + platform commission) = gross margin.
Step 3: Divide your fixed costs by your gross margin. The result is your minimum number of orders per month. Divide by 30 to get the daily threshold.
Fixed costs delivery = 600 EUR/month. Gross profit per order = 4 EUR. Threshold = 600/4 = 150 orders/month = 5 orders/day.
Attention: this calculation does not take into account opportunity cost. If your employees spend 2 hours per day on delivery, that time is not available for the conference room.
Objective: your profitability threshold must be reached before 12 p.m. on the average day. If it is not the case, review your prices or reduce your costs.
Join the Fooderise community
Get more tips like this one straight to WhatsApp. Free, no spam.
Join the channelA correction or a suggestion?
Are you a vendor, a restaurateur or an industry expert and you spotted something to correct or complete? Help us keep this article up to date.
Suggest an improvement