Break-Even Analysis

You are a financial analyst conducting break-even analysis.

**Business/Product:** {business_name}
**Analysis Period:** {period}
**Context:** {analysis_context}

Perform comprehensive break-even analysis:

**1. Cost Structure:**

**Fixed Costs (Monthly):**
| Category | Amount | Annual | Notes |
|----------|--------|--------|-------|
| Salaries | ${salary_fixed} | ${salary_annual} | {salary_notes} |
| Rent | ${rent} | ${rent_annual} | {rent_notes} |
| Insurance | ${insurance} | ${insurance_annual} | {insurance_notes} |
| Software/SaaS | ${software} | ${software_annual} | {software_notes} |
| Marketing (fixed) | ${marketing_fixed} | ${marketing_fixed_annual} | {marketing_notes} |
| Utilities | ${utilities} | ${utilities_annual} | {utilities_notes} |
| Equipment Depreciation | ${depreciation} | ${depreciation_annual} | {depreciation_notes} |
| Other Fixed | ${other_fixed} | ${other_fixed_annual} | {other_notes} |
| **Total Fixed Costs** | **${total_fixed_monthly}** | **${total_fixed_annual}** | |

**Variable Costs (Per Unit):**
| Category | Cost per Unit | % of Price | Notes |
|----------|---------------|------------|-------|
| Materials/COGS | ${cogs_per_unit} | {cogs_percent}% | {cogs_notes} |
| Direct Labor | ${labor_per_unit} | {labor_percent}% | {labor_notes} |
| Commission | ${commission_per_unit} | {commission_percent}% | {commission_notes} |
| Transaction Fees | ${transaction_fee} | {transaction_percent}% | {transaction_notes} |
| Shipping | ${shipping_per_unit} | {shipping_percent}% | {shipping_notes} |
| Variable Marketing | ${var_marketing} | {var_marketing_percent}% | {var_marketing_notes} |
| **Total Variable Cost** | **${total_var_per_unit}** | **{total_var_percent}%** | |

**Revenue:**
- Average Selling Price: ${avg_price}
- Contribution Margin per Unit: ${contribution_margin} (= Price - Variable Costs)
- Contribution Margin %: {contribution_margin_percent}%

**2. Break-Even Calculation:**

**Units-Based:**
- Break-Even Units = Fixed Costs / Contribution Margin per Unit
- Break-Even Units = ${total_fixed_monthly} / ${contribution_margin}
- **Break-Even Units (Monthly): {breakeven_units_monthly} units**
- **Break-Even Units (Annual): {breakeven_units_annual} units**

**Revenue-Based:**
- Break-Even Revenue = Fixed Costs / Contribution Margin %
- Break-Even Revenue = ${total_fixed_monthly} / {contribution_margin_percent}%
- **Break-Even Revenue (Monthly): ${breakeven_revenue_monthly}**
- **Break-Even Revenue (Annual): ${breakeven_revenue_annual}**

**Time to Break-Even:**
- Current monthly units: {current_units}
- Growth rate: {growth_rate}% per month
- **Months to Break-Even: {months_to_breakeven}**
- **Break-Even Date: {breakeven_date}**

**3. Sensitivity Analysis:**

**Break-Even Units by Price:**
| Price | Variable Cost | Contribution Margin | Break-Even Units | % Change |
|-------|---------------|---------------------|------------------|----------|
| ${price_m10} (-10%) | ${var_cost} | ${cm_m10} | {be_units_m10} | {be_change_m10}% |
| ${price_m5} (-5%) | ${var_cost} | ${cm_m5} | {be_units_m5} | {be_change_m5}% |
| ${price_base} (base) | ${var_cost} | ${cm_base} | {be_units_base} | - |
| ${price_p5} (+5%) | ${var_cost} | ${cm_p5} | {be_units_p5} | {be_change_p5}% |
| ${price_p10} (+10%) | ${var_cost} | ${cm_p10} | {be_units_p10} | {be_change_p10}% |

**Break-Even Units by Variable Cost:**
| Variable Cost Change | New Variable Cost | Contribution Margin | Break-Even Units | % Change |
|---------------------|-------------------|---------------------|------------------|----------|
| +20% | ${var_cost_p20} | ${cm_vc_p20} | {be_units_vc_p20} | {be_change_vc_p20}% |
| +10% | ${var_cost_p10} | ${cm_vc_p10} | {be_units_vc_p10} | {be_change_vc_p10}% |
| Base | ${var_cost_base} | ${cm_vc_base} | {be_units_vc_base} | - |
| -10% | ${var_cost_m10} | ${cm_vc_m10} | {be_units_vc_m10} | {be_change_vc_m10}% |
| -20% | ${var_cost_m20} | ${cm_vc_m20} | {be_units_vc_m20} | {be_change_vc_m20}% |

**Break-Even Units by Fixed Cost:**
| Fixed Cost Change | New Fixed Cost | Break-Even Units | % Change |
|------------------|----------------|------------------|----------|
| +20% | ${fixed_p20} | {be_units_fc_p20} | {be_change_fc_p20}% |
| +10% | ${fixed_p10} | {be_units_fc_p10} | {be_change_fc_p10}% |
| Base | ${fixed_base} | {be_units_fc_base} | - |
| -10% | ${fixed_m10} | {be_units_fc_m10} | {be_change_fc_m10}% |
| -20% | ${fixed_m20} | {be_units_fc_m20} | {be_change_fc_m20}% |

**4. Multi-Product Break-Even:**

*(If selling multiple products with different margins)*

| Product | Price | Variable Cost | CM | CM % | Sales Mix | Weighted CM |
|---------|-------|---------------|-----|------|-----------|-------------|
| {product_1} | ${price_1} | ${var_1} | ${cm_1} | {cm_pct_1}% | {mix_1}% | ${weighted_cm_1} |
| {product_2} | ${price_2} | ${var_2} | ${cm_2} | {cm_pct_2}% | {mix_2}% | ${weighted_cm_2} |
| {product_3} | ${price_3} | ${var_3} | ${cm_3} | {cm_pct_3}% | {mix_3}% | ${weighted_cm_3} |
| **Total** | - | - | - | - | 100% | **${avg_weighted_cm}** |

**Blended Break-Even Units:** {blended_be_units} total units
- {product_1}: {be_units_prod_1} units ({mix_1}%)
- {product_2}: {be_units_prod_2} units ({mix_2}%)
- {product_3}: {be_units_prod_3} units ({mix_3}%)

**5. Target Profit Analysis:**

**To Achieve ${target_profit_monthly} Monthly Profit:**
- Required Units = (Fixed Costs + Target Profit) / Contribution Margin
- Required Units = (${total_fixed_monthly} + ${target_profit_monthly}) / ${contribution_margin}
- **Units Needed: {units_for_target} units/month**
- **Revenue Needed: ${revenue_for_target}/month**
- **% Above Break-Even: {percent_above_breakeven}%**

**To Achieve {target_margin}% Operating Margin:**
- Required Revenue: ${revenue_for_margin}
- Required Units: {units_for_margin}

**6. Scenario Analysis:**

**Best Case (Revenue +30%):**
- Units: {best_units}
- Revenue: ${best_revenue}
- Fixed Costs: ${best_fixed}
- Variable Costs: ${best_variable}
- **Operating Profit: ${best_profit}**
- **Operating Margin: {best_margin}%**

**Base Case (Current Plan):**
- Units: {base_units}
- Revenue: ${base_revenue}
- Fixed Costs: ${base_fixed}
- Variable Costs: ${base_variable}
- **Operating Profit: ${base_profit}**
- **Operating Margin: {base_margin}%**

**Worst Case (Revenue -30%):**
- Units: {worst_units}
- Revenue: ${worst_revenue}
- Fixed Costs: ${worst_fixed}
- Variable Costs: ${worst_variable}
- **Operating Profit: ${worst_profit}**
- **Operating Margin: {worst_margin}%**

**7. Margin of Safety:**

**Current Performance:**
- Current Units: {current_units}/month
- Break-Even Units: {breakeven_units_monthly}/month
- **Margin of Safety (Units): {mos_units} units**
- **Margin of Safety %: {mos_percent}%**

Interpretation: Sales can drop {mos_percent}% before hitting break-even.

**8. Operating Leverage:**

**Degree of Operating Leverage (DOL):**
DOL = Contribution Margin / Operating Income
DOL = ${total_contribution} / ${operating_income}
**DOL: {dol_value}**

Interpretation: A 1% increase in sales will result in {dol_value}% increase in operating profit.

**9. Recommendations:**

**Cost Reduction Opportunities:**
1. {cost_reduction_1}: Save ${savings_1}/month → Reduces break-even by {be_reduction_1} units
2. {cost_reduction_2}: Save ${savings_2}/month → Reduces break-even by {be_reduction_2} units
3. {cost_reduction_3}: Save ${savings_3}/month → Reduces break-even by {be_reduction_3} units

**Revenue Enhancement Opportunities:**
1. {revenue_opp_1}: Increase CM by ${cm_increase_1} → Reduces break-even by {be_reduction_rev_1} units
2. {revenue_opp_2}: Increase CM by ${cm_increase_2} → Reduces break-even by {be_reduction_rev_2} units
3. {revenue_opp_3}: Increase CM by ${cm_increase_3} → Reduces break-even by {be_reduction_rev_3} units

**Risk Mitigation:**
- Current MOS is {mos_assessment} ({mos_percent}%)
- Recommendation: {mos_recommendation}
- Target MOS: {target_mos}%
- Actions needed: {mos_actions}

**10. Action Plan:**

**Immediate (Month 1):**
1. {action_immediate_1}
2. {action_immediate_2}

**Short-term (Months 2-3):**
1. {action_short_1}
2. {action_short_2}

**Long-term (Months 4-6):**
1. {action_long_1}
2. {action_long_2}

**Monitoring Metrics:**
- Track: {metric_1}, {metric_2}, {metric_3}
- Review frequency: {review_frequency}
- Alert triggers: {alert_triggers}

Provide: Complete break-even analysis + sensitivity scenarios + action plan.