Yet when you spend money on advertising (or most anything else), you’re going to want to know when it becomes profitable — or calculate the break even point for your wrap.
To determine how many new customers you’ll need to attract to cover the cost of your wrap, you’ll need to know:
Once you have those numbers, you’ll use the following formula where BE equals your break even point.
BE = FC / GM
Now let’s use a few examples to give you a better idea of how this works.
Break Even for More Expensive Products and Services
Mechanics, plumbers, landscapers and other service providers that do higher paying jobs will find this example most relevant.
Let’s say you’re a landscaper and you were quoted $3,500 to wrap your truck. That’s your fixed cost. For the sake of the example, we’ll say that you’re GM for a new customer is an even grand. That means:
BE = FC / GM
BE = $3,500 / $1,000
BE = 3.5
This means you would need to attract 3 or 4 new customers over the life of your wrap (which is about 3-5 years or more) in order to break even. A number of new customers over that amount would mean you’re wrap advertisement is profitable.
Break Even for Less Expensive Products and Services
Food trucks and ice cream trucks are the perfect example here, but this can be for any business that sells a high volume of less expensive items.
Let’s say you’re the new ice cream man in town and you want to know how many snacks you’ll have to sell for your wrap to be profitable. It’s also going to cost you a neat $3,500 to wrap your truck. We’ll say that your GM is $3. This means:
BE = FC / GM
BE = $3,000 / $3
BE = 1,000
So you’d need to make 1,000 sales over the life of your wrap (~3-5 years) in order to break even. Any more sales would mean that your wrap is profitable.
Vehicle Wraps for Las Vegas Businesses
If you’re looking for an effective way to advertise your business without putting in a lot of time or effort, vehicle wraps are the perfect solution for you. Team Acme has been customizing vehicles and fleets with high quality graphics and eye-catching designs for over a decade. Our design team can help you create a professional, visually stunning wrap that will attract new leads as you drive from job site to job site or even while you’re parked outside your office or favorite lunch spot.
Get a quote today or give us a call at (702) 566-8326 and ask us about setting up a fleet account where we’ll install wraps, window tint, and do any auto glass repair necessary on new additions to your fleet with a turnover time of about 24 hours.
Get in, get out, and get on the road quickly with Team Acme!