profit breakeven

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unpakwon

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Could anyone please help me with the following in bold?

Initially, we thought that the executives at Unilever had lost their minds, but as we dug into their cost structure, we learned they weren't crazy at all. They were operating at a profit breakeven. Soon their business had tripled.

I know what "breakeven" means. But what is profit breakeven? Does it just mean "they were making neither a profit nor a loss?"

Thank you.
 
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BobK

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Your topic title uses 'breakeven'; this makes sense - the 'break-even point' is when a company breaks even; for the first few months/years there are start-up costs, and perhaps they have to pay annual bills in advance; they make some money, but the money they make doesn't outweigh their costs. At the break-even point they go from net loss to net profit.

If the phrase is 'profit breakdown', the context you give seems odd. A profit breakdown is an analytical report, showing various sources of profit.

The context suggests that what is going on is what would be called - in British English at least - a 'loss-leader' (when a company loses money on deal at the beginning of a customer relationship - a multi-part series of magazines, say, with the first one at 99p and the next 99 at £7.50).

b
 

unpakwon

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My God! I made a mistake. I'm sorry.

"Profit breakeven" is the correct expression. I corrected the original post.

Again, is the sentence in question saying "they were operating in the way that they were making neither profit nor loss?"
 

BobK

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:up:;-)

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susiedqq

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I still don't get it: if you break even, then costs are covered, staff paid, and there is no "profit" made.

So I don't know how you can have a "profit breakeven" - unless it simply means they didn't run at a loss - which is commendable for a new company.
 

vil

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Attention: I'm not a teacher.

Hi unpackwon,

break even
  • In Britain, to be in a situation where income from sales equals the expenses of production, so that neither profit nor loss is made.
  • In USA to earn from sales not only just enough to pay all expenses but also enough for a moderate dividend.
Break-even analysis , a method of studying the profitability of a business or of a single product by showing at what level of production costs are just covered by income, neither profit nor loss being made; and thus to calculate the effect on profit of changes in the amount of goods produced, the costs of production, and the selling price.

Regards.

V.
 
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