Understanding your numbers doesn’t have to be complex. In this episode, Gavin breaks down one of the most critical concepts in business finance: fixed and variable costs.
You’ll discover how these two cost types directly impact your break-even point, scalability, and profit potential. With practical examples including a real-world turnaround from one of Gavin’s own beach bar businesses; You’ll learn how to use your cost structure to plan growth with clarity and confidence.
🎧 You’ll learn:
The clear difference between fixed and variable costs (with real-world examples)
How to quickly categorise your costs—without overthinking it
Why your break-even point matters more than you think
How fixed costs shrink as a percentage of sales (and boost your margin)
The mindset shift needed to scale profitably
Whether you’re currently stuck at breakeven or ready to scale, this episode gives you the mindset and tools to shift from low-margin survival to high-margin growth.
Jump to a chapter:
0:00 – Intro: Why Fixed and Variable Costs Matter 0:36 – Meet Gavin: Who This Is For 1:13 – Fixed Costs Explained 2:00 – Variable Costs Explained 2:54 – Don’t Overthink Cost Categorisation 3:12 – Categorising Costs into Five Buckets 4:50 – Why Knowing the Difference Really Matters 5:55 – Fixed vs Variable: Visualising the Cost Curve 6:47 – Reaching the Break-Even Point 7:20 – The Power of Scaling Past Break-Even 8:00 – Why Many Business Owners Get Stuck 9:00 – Breaking Through with Confidence 9:23 – Case Study: Scaling a Beach Bar 10:15 – Seeing Profit in the Next $500K 11:00 – Investing Ahead in Marketing 11:50 – Outcome: From Breakeven to $200K Profit 12:30 – Why This Matters for Your Business 13:00 – Recap and Final Takeaway
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