Break-even pricing, revenue and units

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"For a value-added agricultural business, break-even pricing informs how to price a value-added product. If a product's market-accepted sales price is greater than its break-even price, then the business can feel more confident in the financial feasibility of offering the given product. This publication shows how to determine a value-added agricultural product's break-even price, revenue and unit sales from a cost perspective. Note, the need to understand your break-even point also applies when producing farm commodities. However, commodity producers are price-takers, not price-makers. Producer-owned, value-added businesses should operate as price-makers. As a result, they can better anticipate a product's sales price and decide whether the difference between the sales price and the break-even price provides an acceptable return for their investment and the risk they assume when producing a product."--First page.

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Provided for historical documentation only. Check Missouri Extension and Agricultural Experiment Station websites for current information.
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 License.