Break-Even Calculator
Every sale contributes something toward covering fixed costs — until they are covered and everything after is profit. Find the exact unit where that flip happens.
Your results
Charts & visualization
Where the lines cross
Left of the crossing you lose money on the month; right of it, every unit adds its margin to profit.
Every chart’s underlying numbers are available as text — use the “view as table” control under each chart.
How it works
The break-even calculation rests on one idea: each unit sold earns its contribution margin (price minus variable cost) toward fixed costs. Divide monthly fixed costs by that margin and the result is exactly how many units must sell before the month turns profitable.
The chart draws total revenue and total cost against volume; their intersection marks break-even in both units and dollars. Steeper slopes mean faster coverage — which is why small price increases can dramatically shrink the required volume.
Formula used
Fixed costs— constant regardless of volumeContribution margin— price − variable cost per unitBreak-even revenue— units × price
Example calculation
With $12,000 of monthly fixed costs and a $31 contribution margin ($49 price − $18 variable cost), break-even lands at about $387 units — roughly $18,968 in monthly revenue, or around $903 per business day if you sell weekdays. Raise the price by $5 and the requirement drops by more than 60 units.
Assumptions & limitations
- One average price and cost per unit across all sales.
- Fixed costs stay constant within the relevant range; step-changes (new hire, bigger space) reset it.
- No economies of scale in variable cost.
- Monthly basis; divide by selling days for daily targets.
Results are planning estimates based on your inputs and the stated assumptions — not financial advice or a loan offer. Verify important figures with your lender or advisor.
Frequently asked questions
What is a break-even point?
The volume where total revenue equals total cost — no profit, no loss. Beyond it, each sale’s contribution margin becomes profit; below it, losses accumulate at the same rate.
How do discounts affect break-even?
Sharply. Cutting price reduces contribution margin dollar-for-dollar, so the required volume rises disproportionately. A 10% discount on the example pushes break-even from ~387 to ~480 units.
Should I include my own salary in fixed costs?
Yes for honest planning — owners need income like any expense. Many failed businesses “break even” only because the founder works unpaid.
What is margin of safety?
How far actual sales sit above break-even, as a percentage. Selling 500 units against a 387-unit break-even gives roughly 23% safety — the cushion before months turn red.