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Starting something of your own

Price a product, find your break-even point, and survive a slow season.

Lesson 1 of 4

Startup costs

Startup costs are what you spend before your first sale: equipment, permits, first inventory, a sign. Write every one down. People almost always underestimate this list.

For a shave ice stand that might mean an ice shaver, syrups, cups, a tent, a county permit and insurance. Start as small as you can while still learning whether customers want what you sell.

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Run a shave ice stand

Set your price, cost per cup and monthly fixed costs to find your break-even point.

$6.00
$1.50
$1,500
22 days
RevenueTotal costs
$0$1,000$2,000$3,000$4,0000 cups136 cups272 cups391 cups527 cups663 cupsRevenueTotal costs

$4.50

Earned per cup after its costs

334

Cups a month to break even

16

Cups per day open

Check your understanding

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  1. 1.Fixed costs are $1,200 a month and each cup earns $3 after its own costs. How many cups to break even?
  2. 2.Which is a variable cost for a shave ice stand?
  3. 3.Why should a tourism business plan around its slowest month?

Answer every question to check.

For learning only. Kuleana Finance explains how money works. It does not tell anyone what to buy or sell.