Harvard Business Review

JULY 2, 2014

Managers typically use breakeven analysis to set a price to understand the economic impact of various price- and sales-volume scenario. These costs are fixed because they will not change with the number of kites sold. Therefore, the unit variable costs to make a single kite is: $50 ($20 in materials and $30 in labor).

Variable Costs 18

Variable Costs Fixed Costs Sales Sales 18

Harvard Business Review

JUNE 22, 2015

To figure total costs you first multiply the unit quantity sold by the variable costs per unit, then you add the fixed costs. Like this: Note that Price per unit – Variable costs per unit is equal to the Contribution margin per unit. The variable costs to make each pair of flip flops are $14.00.

Variable Costs 15

Variable Costs Fixed Costs Advertising ROI 15

Harvard Business Review

JULY 2, 2014

Managers typically use breakeven analysis to set a price to understand the economic impact of various price- and sales-volume scenario. These costs are fixed because they will not change with the number of kites sold. Therefore, the unit variable costs to make a single kite is: $50 ($20 in materials and $30 in labor).

Variable Costs 10

Variable Costs Fixed Costs Sales Sales 10

Harvard Business Review

JULY 9, 2014

Uber and fellow ride sharing services (such as Lyft and Sidecar) can easily advertise big discounts and regulation-laden taxis are unable to respond. Uber is further capitalizing on this uneven pricing field by running sales this summer. Thus, Uber is pricing below its variable costs.

Variable Costs 8

Variable Costs Transportation Government Telecommunications 8

Harvard Business Review

MAY 18, 2018

per month per subscriber, and three movie tickets costs nearly $30, on average, meaning it’s losing nearly $20 per month per subscriber on a variable cost basis. Ticket sales don’t cover the costs of operating a theater.) The problem is that MoviePass collects only $9.95

Advertising 8

Advertising Variable Costs Revenue Operations 8

Harvard Business Review

AUGUST 3, 2018

However, the real revenue-providing customers are companies that pay for advertisements (they may be called “revenue units”). The company should separately present fixed and variable costs, and to the extent possible, detail the variable costs associated with a unit of activity.

Variable Costs 8

Variable Costs Revenue Assets Accounts 8

Harvard Business Review

FEBRUARY 22, 2011

As each of these companies expands its fixed-cost infrastructure, profits grow geometrically because the additional variable cost of adding each new user is near zero. Adding a profile on Facebook has little to no impact on Facebook's operating costs. They're out to kill the cost-per-thousand or CPM-based ad sales model.

Advertising 16

Advertising Variable Costs Scaling Media 16