⚖️ Break-Even Point Calculator

Find exactly how many units you need to sell to cover your costs

Break-Even Units
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Break-Even Revenue
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Contribution Margin/Unit
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Break-Even Analysis for Small Business

Break-even point is the sales volume at which your total revenue exactly equals total costs — no profit, no loss. Understanding this number is essential before launching any product or business, since it tells you the minimum sales target needed for viability.

The Formula

Break-Even Units = Fixed Costs ÷ (Selling Price − Variable Cost per Unit)

The denominator is called the "contribution margin" — the amount each unit sold contributes toward covering fixed costs after accounting for the direct cost of producing it.

Fixed vs Variable Costs

Fixed costs don't change with production volume — rent, salaries, equipment EMIs. Variable costs scale directly with units produced — raw materials, packaging, per-unit shipping. Correctly classifying costs is essential for an accurate break-even calculation.

Frequently Asked Questions

What if my fixed costs change month to month? +
Use your average monthly fixed costs for a realistic estimate, or recalculate for worst-case (highest) and best-case (lowest) fixed cost scenarios to understand your break-even range.
How does break-even change if I run a discount? +
A discount reduces your selling price, which shrinks your contribution margin per unit — meaning you need to sell MORE units to break even. Always recalculate break-even before running promotions to ensure volume increases will offset the lower margin.
Is break-even analysis useful for service businesses? +
Yes — replace 'units' with billable hours, client projects, or subscriptions, and 'variable cost' with the direct cost of delivering that service (contractor payments, materials per project).