You are a marketing director for a mexican taco restaurant, Ask an Expert

Management Studies

You are a marketing director for a Mexican Taco Restaurant located in Lynchburg, VA. The average order size of your customers is $7.00 per order. That means that when all your food orders are divided by your total number of customers, the average order amount is $7.00.

Your Role/Assignment

Your variable cost per order is $3.00 in food costs and paper products. Of course, there are also fixed costs (whether you sell one or a hundred). These include your building lease ($2,000 per month, electricity $500 per month, and labor $3,100 per month).

Break Even Analysis

Using this formula, what is the break-even point? In other words, how many meals, at $7.00, would need to be sold before you start making a profit?

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Marketing Management, Management Studies

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