Break-Even Calculator
Determine your break-even point by entering your fixed costs, variable cost per unit, and selling price. See exactly how many units you need to sell to cover all expenses and start making a profit.
The break-even point is the volume at which a business stops losing money and starts making it. It's the most important single number in early-stage planning: if you can't articulate how many units, hours, or subscriptions you need to sell to cover your costs, you can't tell whether your business model works.
This calculator walks the standard break-even math: fixed costs divided by contribution margin per unit. Enter your monthly fixed costs (rent, salaries, software, insurance — anything that doesn't change with sales volume), the variable cost per unit (materials, fulfillment, payment processing — anything that scales with each sale), and the selling price. The calculator returns the break-even unit count, break-even revenue, and the contribution margin percentage.
Add an "expected monthly units" forecast and the calculator also shows your projected profit (or loss) at that volume — a quick reality check on whether your sales target actually clears the cost stack.
Inputs
Results
Break-Even Units
250
Break-Even Revenue
$8,750.00
Contribution Margin
$20.00
Expected Profit
$1,000.00
Revenue vs Total Cost
Profit/Loss by Volume
Volume Analysis
| Units | Revenue | Total Cost | Profit/Loss |
|---|---|---|---|
| 0 | $0.00 | $5,000.00 | $-5,000.00 |
| 25 | $875.00 | $5,375.00 | $-4,500.00 |
| 50 | $1,750.00 | $5,750.00 | $-4,000.00 |
| 75 | $2,625.00 | $6,125.00 | $-3,500.00 |
| 100 | $3,500.00 | $6,500.00 | $-3,000.00 |
| 125 | $4,375.00 | $6,875.00 | $-2,500.00 |
| 150 | $5,250.00 | $7,250.00 | $-2,000.00 |
| 175 | $6,125.00 | $7,625.00 | $-1,500.00 |
| 200 | $7,000.00 | $8,000.00 | $-1,000.00 |
| 225 | $7,875.00 | $8,375.00 | $-500.00 |
| 250 | $8,750.00 | $8,750.00 | $0.00 |
| 275 | $9,625.00 | $9,125.00 | $500.00 |
Formula
How to use this calculator
- Enter monthly fixed costs. Include rent, salaries, software subscriptions, insurance, professional services, and a portion of any owner draw if applicable.
- Enter variable cost per unit. For physical products: COGS per unit including materials, packaging, fulfillment, and payment processing. For services: hourly contractor cost or marginal cost per delivered hour.
- Enter the price you actually charge per unit (not list price; what customers actually pay after discounts).
- Enter your expected monthly volume to see profit/loss at that level. Be realistic — most early-stage businesses overestimate sales by 2–3×.
- Run sensitivity scenarios: 70%, 100%, and 130% of expected volume. If you can't survive at 70% of plan, the model has thin margin for error.
Worked examples
Coffee shop
Fixed costs: $14,000/mo (rent, baristas, insurance, depreciation) Variable cost per cup: $1.20 (beans, milk, cup, lid) Price per cup: $5.00 CM per cup: $3.80 Break-even: 14,000 / 3.80 ≈ 3,684 cups/mo ≈ 123/day A coffee shop selling 150 cups/day clears about $1,000/mo profit. At 100 cups/day, the shop loses about $2,600/mo. The model is highly volume-sensitive — even small foot traffic shifts move the bottom line dramatically.
SaaS subscription
Fixed costs: $40,000/mo (engineers, hosting baseline, marketing) Variable cost per customer: $5/mo (per-customer hosting + support) Price per customer: $79/mo CM: $74/customer/mo (94% margin) Break-even: 40,000 / 74 ≈ 541 customers At 600 customers: profit = (600 × 74) − 40,000 = $4,400/mo At 1,000 customers: profit = $34,000/mo High contribution margin means small volume increases drive large profit moves — typical SaaS economics.
When to use this calculator
Use break-even analysis early and often: business plan, pricing changes, considering a new fixed cost (like hiring), evaluating a price discount or promotion. Any decision that changes fixed costs, variable costs, or price should be re-tested against break-even.
Limitations: - Assumes a single product/service or a stable mix - Treats all fixed costs as truly fixed, even though "stepped" costs (the next employee, the next office) shift discontinuously - Ignores cash timing — break-even is an accounting concept, not a cash flow one - Doesn't model seasonality
For multi-product businesses, run break-even per product line or use a weighted-average contribution margin. For early-stage cash planning, combine break-even with the cash flow and burn rate calculators.
Common mistakes to avoid
- Confusing fixed and variable costs. Software subscriptions are usually fixed; payment processing fees are usually variable; salaries can be either depending on whether they scale with volume.
- Pricing at break-even and assuming "you'll grow into profit." Without contribution margin you don't grow into profit, you grow into bigger loss.
- Forgetting your own time cost. Founder labor is real; if break-even leaves the founder unpaid, the business isn't actually breaking even.
- Ignoring discount rates and refunds. List price is not realized price.
- Setting break-even based on optimistic volume. Run conservative scenarios — what happens at half your forecast?
Frequently Asked Questions
Sources & further reading
- Break-even analysis — U.S. Small Business Administration