“Does one dollar of extra fixed costs needs one extra dollar of sales to recover it?” A logical answer is “one dollar“. What if I would tell you that this is not true? Let’s have a look!! What is Contribution Margin (CM)? Contribution Margin (CM) is highly used in menu …
What is the cost structure? Cost structure refers to the level of a restaurant’s fixed and variable expenses in relation to its sales. Fixed expenses are considered those expenses a restaurant will incur anyway regardless on the number of its guests. Variable expenses are those expenses that behave in a …