Break-Even Calculator
Calculate your break-even point in units and revenue. Enter fixed costs, price per unit and variable cost per unit to see exactly when you start making a profit.
Why break-even matters
Break-even is the point where your sales cover all your costs and you stop losing money. Below it you run at a loss, above it you turn a profit. Knowing this number tells you whether a price is realistic and how many sales a new product needs before it pays for itself. It is one of the first things a lender or investor asks about.
The maths behind it
First find your contribution margin, which is the price per unit minus the variable cost per unit. That is the money each sale puts toward fixed costs. Divide your total fixed costs by the contribution margin and you get the number of units to break even. If the contribution margin is zero or negative, you lose money on every sale and no volume will save you.
How to use it
Enter your fixed costs, your price per unit, and the variable cost to make or deliver one unit. The tool returns the units you must sell, the revenue that represents, and the contribution per unit. Raise the price or cut the variable cost and watch the break-even point drop. To check the profit on each unit, pair this with the Profit Margin Calculator.
Frequently Asked Questions
How do you calculate the break-even point?
Divide total fixed costs by the contribution margin per unit, where contribution margin is price minus variable cost per unit.
What are fixed and variable costs?
Fixed costs stay the same no matter how much you sell, such as rent. Variable costs rise with each unit, such as materials.
What if my contribution margin is negative?
You lose money on every sale and cannot break even. Raise your price or lower your variable cost per unit first.
Is this tool free?
Yes, free and private in your browser.