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Assume that you are offering a freelance pizza delivery service for local pizza stores that do not have their own delivery service. Based on the going rate for pizza in your market area and the geographic market you plan to cover, create a breakeven analysis for your new business. You are free to negotiate a percentage of the food tab as part of your fee. After you have completed the breakeven analysis, compute the number of deliveries you will need to make each week to net $250. Please be sure to show your direct and indirect costs.

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Solution Summary

I created a sample business with a flat fee for delivery of $5 per pizza. Two scenarios are shown, selling an average of 40 pizzas per night and 80 pizzas per night, and the related direct and indirect costs and resulting operating profit. Then, I compute the number of pizzas you have to sell to "net" $250. Formulas shown and computed for you.

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I created a sample business with a flat fee for delivery of $5 per pizza. Two scenarios are shown, selling an average of 40 pizzas per night and 80 pizzas per night, and the related direct and indirect costs and resulting ...

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Carol Sargent, PhD
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  • BSc, University of Virginia
  • MSc, University of Virginia
  • PhD, Georgia State University
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