Break-Even Calculator
Calculate when your business breaks even
Results are estimates and may not reflect your actual financial situation. This is not financial, tax, or legal advice. Consult a qualified professional.
How to use
Enter your total fixed costs (rent, salaries, insurance), selling price per unit, and variable cost per unit (materials, labor per item). The calculator shows how many units you need to sell to break even, plus the contribution margin that drives profitability.
Formula
Examples
Coffee shop
Fixed costs of $5,000/month (rent, utilities, wages). Each coffee sells for $5 with $1.50 variable cost. Break-even is 1,429 coffees per month, or about 48 per day. Above that, every coffee generates $3.50 in contribution margin.
SaaS startup
Fixed costs of $20,000/month (team, servers, office). Subscription price $49/month with $5 variable cost (hosting, support). Break-even is 455 subscribers. The 90% contribution margin ratio means most revenue goes toward covering fixed costs.
E-commerce product
Fixed costs of $3,000/month (warehouse, software). Product sells for $35 with $18 variable cost (COGS, shipping). Break-even is 177 units per month. Use the profit-at-volume section to see revenue at your target sales volume.
Frequently asked questions
What are fixed costs vs variable costs?
Fixed costs stay the same regardless of sales volume: rent, salaries, insurance, software subscriptions. Variable costs change with each unit sold: raw materials, packaging, shipping, sales commissions. Some costs are semi-variable (like utilities), classify them based on their dominant behavior.
What is contribution margin?
Contribution margin is selling price minus variable cost per unit. It represents how much each sale "contributes" toward covering fixed costs. Once fixed costs are fully covered (break-even point), the entire contribution margin becomes profit. A higher contribution margin means fewer sales needed to break even.
What if variable costs exceed my selling price?
If variable cost per unit is higher than your selling price, every sale loses money and no break-even point exists. You need to either raise prices, reduce variable costs, or fundamentally rethink the business model. This situation means your unit economics are negative.
How do I use break-even for pricing decisions?
Try different price points and see how the break-even point changes. A higher price means fewer sales to break even but may reduce demand. A lower price needs more volume but may attract more customers. The right price balances break-even achievability with realistic sales volume.
Does this account for taxes?
This calculator uses pre-tax figures. To account for taxes, you can include tax obligations in your fixed costs (if predictable) or calculate break-even on a pre-tax basis and apply your tax rate to the resulting profit. Consult an accountant for tax-specific planning.
About this tool
Calculate your break-even point in units and revenue. Enter fixed costs, selling price, and variable costs to find when your business becomes profitable.
All calculations are performed locally in your browser. Your data never leaves your device.