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Fixed vs variable costs for small business: the definition, the examples, the traps
Every cost in your shop is either fixed or variable. Which one it is decides how it shows up in your daily P&L, where your break-even sits, and how every staffing, pricing and scaling decision lands. Most owners get the headline right and the edges wrong — and the edges are where the money quietly leaks. This is the plain-English explainer, with examples for cafe, retail, salon and e-commerce, the six traps that catch almost everyone, and how nouz handles each.
Ibrahim Ölmez
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25 May
Fixed cost coverage ratio: the one number that tells you if your shop is paying for itself
Fixed cost coverage ratio is total contribution margin divided by total fixed costs. A ratio of 1.0 means you are breaking even — every euro of fixed cost is covered exactly. Above 1.0 is profitable; below 1.0 is losing money.
Ibrahim Ölmez
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25 May
EBIT vs EBITDA: the difference in plain English (and which one a small-shop owner should track)
EBIT is operating profit before interest and tax. EBITDA is the same number with depreciation and amortisation added back — so it always looks bigger. For most small shops, EBIT is the honest number; EBITDA is what gets quoted when someone wants the figure to look healthier than it is.
Ibrahim Ölmez
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25 May
Days sales of inventory (DSI): the days-on-hand number that explains your cash cycle
DSI tells you the average number of days it takes to sell through your inventory. €18.000 of stock against €72.000 of annual COGS = 91 days on the shelf. The longer it sits, the longer your cash sits with it.
Ibrahim Ölmez
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25 May
Daily P&L for small business: the definitive guide for owner-operators who need to know if today paid for itself
Daily P&L is its own genre — distinct from the monthly accounts your accountant produces, distinct from the revenue dashboards your POS shows, distinct from the spreadsheet most owners abandoned in year two. It is the same-day operating profit number computed every evening from the day's real entries, and it is the single most useful instrument an owner-operator can have on their phone. This guide walks the entire territory: the formula, the worked examples, the diagnostic patterns, the verticals, the 30-day install plan — everything that makes daily P&L the daily ritual that quietly separates owners who build a business from owners who tread water in one.
Ibrahim Ölmez
·
25 May
Cover count (restaurant): the headcount metric your transaction report is not telling you
A cover is one guest served, not one bill paid. A table of four is one transaction and four covers — and the difference is what tells you whether last night was busy or just expensive.
Ibrahim Ölmez
·
25 May
Contribution margin explained: the dollars per sale that keep your shop alive
Contribution margin is revenue per unit minus variable cost per unit — the money left over from each sale to "contribute" toward covering your fixed costs. It is the denominator in every break-even calculation and the single most useful per-product number a small-shop owner can learn to read.
Ibrahim Ölmez
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25 May
COGS in ecommerce: what to include, what to exclude and the per-order calculation
COGS in ecommerce is the true cost of putting one order in a customer's hands — product, freight in, packaging, and per-order fulfillment. Ads and Shopify fees are not COGS.
Ibrahim Ölmez
·
25 May
Customer Lifetime Value (CLV): the formula, worked example and the 3:1 rule
CLV is the total gross profit one customer generates over the whole time they buy from you — minus what you paid to acquire them.
Ibrahim Ölmez
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25 May
Chair utilization rate: what it is, how to calculate it, and the salon benchmarks that matter
Chair utilization rate tells you, in one percentage, how full your booking calendar actually is — and whether your next problem is pricing, marketing, or hiring.
Ibrahim Ölmez
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25 May
Cash runway: the number of months before the bank account hits zero
Cash runway tells you how many months of operation you have left at the current rate of cash burn — the single most important number when reserves are shrinking and revenue is not yet ahead of costs.
Ibrahim Ölmez
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25 May
Cash flow vs profit explained: why profitable shops go broke and unprofitable ones survive
Profit is what your business earned over a period. Cash flow is what landed in (and left) your bank account over the same period. They are not the same number, and they rarely move together. The most successful shop on your street can die from a cash crunch. The least profitable can stay open for years on great cash flow. Owners who do not understand the difference get blindsided — usually around month four.
Ibrahim Ölmez
·
25 May
Customer Acquisition Cost (CAC): the honest definition, formula and worked example
CAC is what it actually costs you to win one new customer — and the honest version includes every euro you spent to get them, not just the ad spend.
Ibrahim Ölmez
·
25 May
Burn rate: how fast a small shop is consuming its cash reserves
Burn rate is the net cash flowing out of the business each month — the speed at which your reserves shrink when costs are running ahead of revenue.
Ibrahim Ölmez
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25 May
Break-even point: the formula every small shop should know in one paragraph
The break-even point is the revenue (or unit count) at which total revenue exactly matches total costs — the point where your shop stops losing money for the day and starts earning it.
Ibrahim Ölmez
·
25 May
Break-even analysis for small business: the formula, the worked examples, the daily number that defines survival
Most small-shop owners can quote their revenue. Almost none can quote their break-even point — the revenue level at which the business stops bleeding. That single number defines survival. Here is the formula in plain language, three sector-by-sector worked examples (cafe, Shopify, salon), the three levers that move it, and how nouz makes it visible monthly and daily instead of quarterly and late.
Ibrahim Ölmez
·
25 May