The break-even point is the revenue at which total costs are covered and profit is zero. It is calculated by dividing fixed costs by the contribution margin ratio.
Expressed in covers rather than currency, break-even becomes an operational target the floor can act on: how many guests a service needs before the day is worth trading.
Fixed costs must genuinely be fixed. Costs that scale with sales belong in the variable side, or the break-even figure comes out too low.
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