Figuring break even costs
I have been doing street fairs, roadside and small Fair events for a couple of years,But this coming year I'm going to jump into some bigger fairs and festivals.I have been able to do a simple break even Calc. on these small fairs;free & low cost entries etc.But Now I'm looking at higher fees,percentages of sales,cost of my new trailer etc.So I'm wondering how/what do I figure in to make a break even cost to make my menu prices?Do I divide the cost of:
Monthly trailer payments /number of days?
Cost of Fair space /number of event days
anything over 2500.00 there is a 20% cut to the fair how do I figure that in.Projected sales per day?what is an average?Sometimes it's all PP Sammie's and other times it's all ribs.big diff in income.
I'm not a math person and I'm going to add (Ideas? %) to my break even but not sure how to go about figuring my break even on these cost.The food I have down. Any help please.
Your Company's Break Even Calculation
What you are asking is too complex to answer. You need to use a software program like Quick Books to keep records on your Profit and Loss (P&L). When you break everything down from an anual / quarter / Month / Week view on a P & L, "Break Even" is when your sales equals your Cost.
One way to predict is to at the beginning of the year is:
1) Add up all of your anual cost and devide by the number of festivals you will vend. This gives you an average operating cost per event to add.
2) Predict Sales Oportunity for each festival by multiplying 3-5% of last years attendance.
3) Figure out what your product cost are for each event seperate by looking at what it will cost you for the product you will sell at this event multiplied by step 2 (That events Sales oportunity). Then add in all other event specific cost such as Travel, Lodging, Spot fees, etc. to get event's total cost.
4) Add Step 1 (Average Operating Cost) to each of the event's Cost (Step 3) to obtain the Total Event's Break Even Cost for each event.
5) Devide Step 4 (Events Break Even Cost) by Step 2 (Event's Predictive Sales Oportunity) for each event to obtain the "average sales cost" per event.
6) Add your desired average profit desired (like 25%) on the sales to obtain both the average sales price for each event and total sales required to make projected event profit.
As you can see, this is very complex, but it is always good to have a plan and knowledge what sales amount at a event is a "Win" situation.
Best of Luck,
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