In many companies, labor costs are variable costs. But I think the cost of the work of travel agencies operating under. Need a recruiting desktop and mobile, the phone keeps ringing. Of course, we can say that if you take the $ 2 million operations, if necessary additional staff, increasing fixed costs. This is known as the effect. You can grow the airline. But my example, I suppose, given the $ 400 000 is not necessary to add some overhead, which means there is no need to hire new employees, without buying a new computer, do not add a space, and so on.
But it is good to know how much space you have the space. You can see if you make a differential analysis of the company, you can specify a number of things:
• the number of tickets you must sell to be black.
• the profitability of the business.
• The relationship between variable costs and pay a lower yield.
• the effect of increasing the rates available through the replacements.
• The time is necessary to increase the fixed costs to accommodate new businesses.
I’ve seen too many agencies make the mistake of reducing their income from commissions, without receiving any benefit for smartphones. If you look carefully the information you have the tools to do at least one decision. It allows you to measure the effectiveness of additional activities.