Break-Even Point Calculator

Find the exact sales volume where your business stops losing money. Enter fixed costs, selling price and variable cost per unit — get the break-even point in units and revenue, plus your contribution margin.

How to use this calculator

Enter your total fixed costs for the period (usually monthly).
Enter the selling price and variable cost per unit.
Press Calculate to see how many units — and how much revenue — covers everything.
Test scenarios: raise the price or trim variable cost and watch the break-even fall.

Formula used

Break-even units = Fixed costs ÷ (Price − Variable cost per unit)

The denominator is the contribution margin — what each sale contributes toward fixed costs. Once fixed costs are covered, that same margin per unit becomes pure profit.

Example calculation

Worked example

Fixed costs 50,000/month, price 500, variable cost 300:

Contribution margin = 200/unit → break-even = 50,000 ÷ 200 = 250 units (revenue 125,000). Selling 400 units yields (400 − 250) × 200 = 30,000 profit.

Understanding break-even analysis

Every business has two kinds of costs: fixed (rent, salaries — owed regardless of sales) and variable (materials, shipping — incurred per unit). Break-even analysis finds the volume where contribution from sales exactly covers the fixed base.

It's the fastest sanity check for any venture: if break-even requires more customers than the market plausibly offers, the model needs a higher price, lower costs, or a rethink — before money is spent finding out the hard way.

Why use this calculator?

Validate a business or product idea with one number: is the required volume realistic?
See how price changes move the target — a 10% price rise can cut break-even volume dramatically.
Set sales targets that mean something: break-even, then profit goals in units.

Frequently asked questions

What counts as a fixed vs variable cost?

Fixed: unchanged by sales volume — rent, salaries, insurance, software. Variable: scales with each unit — materials, packaging, payment fees, sales commission. Semi-variable costs (utilities, overtime) are usually split or treated as fixed for safety.

What is contribution margin?

Selling price minus variable cost per unit — what each sale "contributes" toward fixed costs and then profit. A 40% contribution ratio means 40 of every 100 in revenue survives past direct costs.

How can I lower my break-even point?

Three levers: raise prices (strongest effect), reduce variable costs per unit, or cut fixed costs. Converting fixed costs to variable (commission instead of salary, cloud instead of servers) also lowers the risk floor.