Break-Even Point Calculator
Enter your fixed costs, variable cost per unit, selling price, and an optional target profit. The calculator finds the exact number of units you must sell before each additional sale starts generating pure profit — and shows you the revenue milestone where your business stops losing money and begins to win.
Break-even units
667
units to cover all costs
Break-even revenue
$16,675.00
Contribution margin
$15.00(60.00%)
Revenue vs total cost
How it works
Contribution margin is the amount each unit sale contributes toward covering your fixed costs after paying for the variable costs of producing that unit. It is calculated as price minus variable cost per unit, and expressed as a percentage of price (the contribution margin ratio). A higher contribution margin means each sale does more work — you need fewer units to cover overhead and reach profitability.
Break-even units are calculated by dividing total fixed costs by the contribution margin per unit, then rounding up with ceiling — because you cannot sell a fraction of a unit. Selling 666.67 units is not a real option; you need 667. Ceiling ensures the result you see always covers your costs; floor would leave you a few dollars short.
If you enter a target profit, the calculator adds that amount to your fixed costs before dividing by contribution margin. This reveals the exact unit volume and revenue level needed to hit your profit goal — useful for setting sales targets, validating pricing, and stress-testing whether your cost structure makes the goal achievable at realistic volumes.
Frequently asked questions
What counts as a fixed vs variable cost?+
Fixed costs stay constant regardless of how many units you produce or sell — rent, salaries, insurance, loan repayments, and software subscriptions are typical examples. Variable costs scale directly with each unit: raw materials, packaging, per-unit shipping, sales commissions, and payment-processing fees. Some costs are semi-variable (a utility bill with a base charge plus a per-unit component); for a break-even model, split them into their fixed and variable portions and allocate accordingly.
My break-even seems impossibly high — what levers do I have?+
Three honest levers: raise the price (if the market allows it, this lifts contribution margin immediately and is often the most powerful move); reduce variable cost per unit (renegotiate suppliers, improve yield, switch materials); or cut fixed costs (smaller premises, fewer permanent staff, renegotiate contracts). Beware of chasing volume alone — selling more units at a low margin just delays the problem. If none of the levers close the gap, the business model may need rethinking before scaling.
Does this work for services?+
Yes. For a service business, 'variable cost per unit' is the direct cost of delivering one service engagement — contractor time, materials consumed, platform fees. 'Fixed costs' are your overhead regardless of how many clients you serve. 'Price per unit' is your fee per engagement. The same contribution-margin logic applies. One nuance: service capacity is often the real constraint, not just cost — if you can only serve 20 clients a month, a break-even of 50 units tells you something important about scalability.