Calculate Break-even Point for Hospitality to manage business

What you'll learn

• fundamentals of breakeven points

• how to calculate breakeven points

• what are assumptions

• how to segregate fixed and variable costs

• understanding impact of break even points

• sensitivity analysis of breakeven points

• Basics 36:58

  • 1: 1. Course Intro to Breakeven Point Analysis Preview 01:19
  • 2: 2. What is Breakeven Analysis Preview 13:04
  • 3: 3. Simple Example to undersand 09:01
  • 4: 4. ExcelModel and Scenario Planning 13:34

• Advanced Version of Break Even Points 12:07

  • 5: 5. Whats wrong with assumptions 06:25
  • 6: 6 Sensitity Analysis 05:42

• Practical Exercise to Create a Break Even point for Hotels 46:43

  • 7: 7. Gathering Hotel P&L for Breakeven Point Analysis Preview 03:45
  • 8: 8. Establish Relationships in P&L lines 07:53
  • 9: 9. Creating Model to seggregate Fixed and Variable Revenue 05:53
  • 10: 10. Model to seggregate Food cost and Payrol Expenses 07:48
  • 11: 11. Modeling other department expenses 06:11
  • 12: 12. Understanding Other hotel expenses 08:58
  • 13: 13. Playing with the model to calculate breakeven point 06:15

What is the Breakeven Point (BEP)?

In accounting, the break-even point formula is determined by dividing the total fixed costs associated with production by the revenue per individual unit minus the variable costs per unit. In this case, fixed costs refer to those which do not change depending upon the number of units sold. Put differently, the breakeven point is the production level at which total revenues for a product equal total expenses.

As a simple equation it may be, practically its error-prone and very difficult to understand and interpret the results of break-even analysis. This course will explain the practical assumptions businesses need to make, sensitivity analysis of all assumptions, scenario planning to understand the impact of different business models.

We will also look at practical difficulties in calculating the breakeven points through a detailed model on the hospitality business. Though an example related to hotels, principals can be applied to all businesses.

• managers
• small business owners
• executive management staff who need to make strategic decisions
• finance executives

• Basic Maths

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Reed courses certificate of completion

Digital certificate - Included