Library

Estimating Costs of Production

James Wade, Lew Daugherty and, Russell Tronstad (1995)

Summary

Taking the time to figure our your break-even price for covering variable costs, all costs, and cash costs is a vital component for pricing decisions and economic viability. If your break-even price (after covering all costs) is higher than the existing competition, then you need to consider growing something else or become innovative at lowering your costs of production.