Tag Archives: variable costs

What costs are relevant when determining how many pizzas a month Zume Pizza must sell to break even?

Zume Pizza uses a combination of robots, artificial intelligence (AI), and GPS in its food trucks to deliver pizzas to customers’ houses just as the pizza is finished baking. Pizzas are actually prepared and baked in the Zume pizza truck by an employee assisted by robots.  Zume Pizza started operations in April 2016 and is currently […]

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How would replacing a tattoo artist with a robot change the cost structure at a tattoo studio?

French artists Pierre Emm and Johan da Silveira have developed a prototype of a tattoo robot during an Autodesk-sponsored Pier 9 residency in San Francisco. There are several steps involved in the tattooing process when performed by a robot. First, a 3D scan of the targeted body part has to first be made. The tattoo […]

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How many snow cones need to be sold for a Snowie™ snow cone cart to break even?

Snowie™ is a brand of flavored shaved ice that is sold in snow cones at a variety of events and locations across the United States.  Recently, a Snowie™ cart was spotted at the Kent Heritage Festival this summer. During this festival, street vendors offer a variety of foods and drinks. At the Snowie™ cart, festival […]

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What costs are relevant when pricing a cargo ship cruise?

Challenging economic conditions in several countries have pushed freight ship companies to look for additional sources of revenues in addition to the revenue generated by hauling freight across the ocean.  In recent years, one additional source of revenue for these freight companies has been to take on cruise passengers in addition to regular cargo. Generally […]

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What happens to the breakeven point when Sports Illustrated lays off all six staff photographers and uses freelancers instead?

Sports Illustrated announced in late January 2015 that it would be laying off all six of its staff photographers.  Instead, it will be using freelance photographers around the world.  Sports Illustrated is one of 90 magazines owned by Time Inc. (TIME).  Published 56 times a year, Sports Illustrated is read by over 23 million people […]

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How would using drones or bike messengers to deliver products affect Amazon’s cost structure and risk?

Amazon is a huge retailer, but it still struggles to compete against bricks-and-mortar stores when customers want the item “right now.” Amazon is currently testing two options to provide one hour deliveries: drones and bike messengers. A drone is an aircraft that flies without a human on board.  It may be operated via remote control, […]

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What impact do lower fuel costs and other changes have on American Airline’s break even point?

American Airlines Group (AAL), the world’s biggest airline, has been reporting record profits in recent quarters.  United Continental Holdings and Southwest Airlines also reported record profits. Part of what has contributed to the record profits has been the decline in the cost of oil. The price of oil has fallen during 2014; we are spending […]

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How will installing tablets at all tables affect Applebee’s breakeven point?

At Applebee’s, Presto tablets by E la Carte are being installed at every table. In total, Applebee’s will be purchasing 100,000 tablets. Customers will be able to pay their food bill and order appetizers and desserts using the tablets.  The tablets are not replacing wait staff; wait staff will still take the orders for entrees.  […]

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How did State Street Corp. achieve cost savings from its co-working building design in Boston?

“Co-working” is a term to describe a work environment where coworkers share the same office but not necessarily the same boss. Co-working centers feature large, central open spaces with couches, coffee tables, and casual furniture.  Some private, traditional offices typically are available for occasional use. The spaces are designed to foster socializing and exchanging ideas […]

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How do costs of a fashion truck compare with the costs of a bricks-and-mortar store?

Fashion trucks are starting to pop up across the country.  These fashion trucks are fashion boutiques on wheels.  The owners of the fashion trucks drive them from locale to locale, seeking to bring clothing and accessories to urban dwellers who value the convenience of a mobile store front. Emily Duran operates the light pink Passionista […]

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