Break-Even Point Calculator
The break-even calculator tells you the exact number of units — and the revenue — your business must achieve each month to cover all fixed and variable costs. Enter your monthly fixed costs, the variable cost per unit, and your selling price per unit. Optionally add your expected sales volume to see your margin of safety. The tool shows your contribution margin per unit, break-even units and revenue, and a clear bar chart that compares fixed costs, total variable costs and revenue at break-even. Use it for product launches, service pricing, café menus, freelance offerings, or whenever a fixed-cost-plus-unit-economics model applies.
You need to sell 348 units per month to cover all costs.
How to use this calculator
- 01Add up all monthly fixed costs (rent, salaries, software, insurance).
- 02Enter the variable cost to produce or deliver one unit.
- 03Enter the price you charge customers per unit.
- 04Optionally add your expected monthly unit sales to see your safety margin.
- •Break-even units = fixed costs ÷ (price − variable cost per unit).
- •Contribution margin per unit is the cash each sale contributes to fixed costs.
- •A negative contribution margin means you lose money on every sale — pricing must change first.
- •Margin of safety above 30% gives healthy room for demand swings.
- •Lower fixed costs lower break-even faster than raising prices.
Frequently asked questions
What is break-even analysis?
Break-even analysis finds the sales volume where total revenue exactly covers total costs — neither profit nor loss. It is the single most important pricing and capacity decision a business makes.
Should I include my own salary in fixed costs?
Yes if you are a full-time founder. Treating your time as free distorts the calculation and leads to under-pricing. Use a realistic market salary for your role.
What if my variable cost varies by order size?
Use a weighted average for the volume range you expect. For high-variance scenarios, compute break-even for the worst-case unit cost to stay conservative.
How is contribution margin different from gross margin?
Contribution margin is gross margin expressed per unit and is used specifically to absorb fixed costs. Gross margin is a percentage of revenue at the company level.
Why doesn't the calculator include taxes?
Income tax applies to profit, which by definition is zero at break-even. Sales tax (VAT) is collected and remitted — it is not a business cost. Both are correctly excluded.
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