Figure 9.4: Bakery Pricing & Breakeven Analysis
INPUT (Yellow Cells)
- No Negative Numbers
| CURRENT | STRATEGY 1 | STRATEGY 2 | |||
| Price | $10.00 | ||||
| Customers | 1200 | ||||
| Capacity (Customers) | 2000 | ||||
| Variable Cost per Transaction | $3.00 | ||||
| Fixed Cost | $7,500 | ||||
| PERFORMANCE | |||||
| Revenue | $12,000 | $12,000 | $12,000 | ||
| Margin Per Unit | $7.00 | $7.00 | $7.00 | ||
| Total Margin | $8,400 | $8,400 | $8,400 | ||
| Fixed Cost | $7,500 | $7,500 | $7,500 | ||
| Profit | $900 | $900 | $900 | ||
| Profit (% of Sales) | 7.5% | 7.5% | 7.5% | ||
| Breakeven Volume | |||||
| Breakeven Customers | 1071 | 1071 | 1071 | ||
| Percent Used Bakery Capacity | 53.6% | 53.6% | 53.6% | ||
Instruction: Change yellow cells for Strategy 1 and Strategy 2 to experiment with two new strategies. This MBM/APP allows you to evaluate the impact of these strategies in comparison to the current strategy in breakeven customers, profit and profit as a percent of sales.