Refer to Increase Distribution Coverage in Appendix 2: Marketing by the Numbers to answer the following question. Assume that adding this mobile service will increase fixed costs by $32,500 and that a contribution margin of 65 percent is desired. Determine the increase in sales necessary to break even on adding the service.

According to the American Massage Therapy Association, the therapeutic massage industry grew more than 7 percent between 2013 and 2018, reaching $18 billion in revenue. The industry will continue to grow an estimated 4 percent or more through 2022. Although the majority of massages are performed in spas, massage therapy offices, or franchises such as Massage Envy, almost 30 percent occur in clients’ homes. That has gotten the attention of many licensed massage therapists who see it as an opportunity to expand their businesses beyond their offices or spas. Some in-home patients are wealthy and prefer the personal service, whereas others are disabled or elderly homebounds who cannot get out to receive needed therapy. In-home messages require additional equipment, such as a portable massage table and supplies such as flannel sheets, pillows, towels, lotions, massage stones, and relaxing music in addition to a vehicle. Additionally, because the production and consumption of services such as massages occur simultaneously, to really expand business, more massage therapists must be hired to cater to more clients.