Pricing and volume

How many do you need to sell?

Break-even is one subtraction and one division. Take the price, take off what one sale costs you to deliver, and what's left over is what that sale contributes to everything else.

Build the plan with the numbers below already in, or put your own price and costs in first.

Then divide the costs that don't move with sales, the rent and the software and the salaries, by that contribution. What comes out is how many you have to sell in a month before the month makes money.

The care goes into which costs sit on which side. A salary is fixed until you hire again, so it belongs below. A payment processor's fee moves with every sale, so it belongs in the cost of the sale.

What the full model adds

• A break-even that moves through the year, because fixed costs step up the month you hire and prices rarely hold still.
• Payroll with the employer's tax and a benefits allowance on top, which is the fixed cost most people leave out.
• The cash side of it. A month can break even on paper and still be short, if customers pay you thirty days later.
• The three statements a lender or an investor asks for, built from these same numbers.

Building a plan is free. Saving it to an account, Excel and the print pack come with a paid plan, and the pricing page lists what each one holds.