Break-Even Calculator
Find your break-even point in seconds. Enter your fixed costs, price, and variable cost per unit to see exactly how many units you need to sell. Free, no signup, no spreadsheet.
Contribution margin: $30/unit (60%)
How the break-even calculator works
Enter three numbers, your fixed costs per month, the price you charge per unit, and what it costs you to deliver one more unit, and the calculator instantly shows your break-even point: the number of units (and the revenue) you need to sell each month before you start making a profit. Add your estimated monthly sales and it also shows how close you are to that line right now.
The break-even formula, explained
Break-even analysis comes down to one idea: every unit you sell contributes a little money toward covering your fixed costs. That per-unit contribution is called the contribution margin, your price minus your variable cost per unit. Once enough units’ worth of contribution margin adds up to cover your fixed costs, you’ve hit your break-even point.
- Contribution margin = price per unit − variable cost per unit
- Break-even point (units) = fixed costs ÷ contribution margin
- Break-even point (revenue) = break-even units × price per unit
If your contribution margin is $30 and your fixed costs are $4,000/month, you need to sell 134 units a month just to cover costs, anything beyond that is profit.
Common break-even analysis mistakes
- Forgetting a variable cost. Payment processing fees, shipping, and packaging are variable costs too, leave them out and your break-even point looks lower than it really is.
- Using revenue instead of price per unit. Break-even analysis works per unit; mixing in blended or discounted revenue skews the contribution margin.
- Treating fixed costs as static forever. Rent, salaries, and software costs creep up, rerun the calculator whenever your fixed costs change.
- Ignoring the break-even point when pricing. A lower price can win more customers but also raises your break-even point, always check both.
- Assuming break-even means “safe.” Break-even means $0 profit, not a healthy business, you still need margin for taxes, reinvestment, and bad months.
Frequently asked questions
What is the break-even point?
The break-even point is the level of sales, in units or in revenue, where your total revenue exactly equals your total costs. Below it you’re operating at a loss; above it, every additional sale is profit.
How do you calculate the break-even point?
Divide your fixed costs by your contribution margin (price per unit minus variable cost per unit). That gives you the break-even point in units. Multiply that by your price per unit to get the break-even point in revenue.
What's the difference between break-even units and break-even revenue?
Break-even units is how many individual sales you need to make; break-even revenue is the dollar figure those sales add up to. They describe the same break-even point from two angles, units for production/sales targets, revenue for cash-flow planning.
What's a good contribution margin?
It depends on the business model, but a contribution margin below 20-30% usually means you’ll need very high sales volume to cover fixed costs. Software and subscription businesses often run 70-90% margins; physical products with shipping and materials costs are often lower.
Does break-even analysis include one-time startup costs?
No, this calculator's break-even point is based on recurring monthly fixed costs (rent, salaries, subscriptions), not one-time costs like equipment or initial inventory. Those one-time costs affect how long it takes to recoup your total investment, which is a separate calculation from monthly break-even.
Can the break-even point change over time?
Yes. Any change to your fixed costs, price, or variable cost per unit shifts your break-even point, a rent increase raises it, a cheaper supplier or a price increase lowers it. Rerun the numbers whenever a cost or price changes.
Why does break-even analysis matter for a new business?
It turns "how much do I need to sell?" into a specific, testable number instead of a guess. Before you set pricing, take on more fixed costs, or plan a launch, break-even analysis tells you the minimum sales volume required just to not lose money.
Related free tools
- Startup Idea Generator, no idea to run the numbers on yet? Generate one first.
- Competitor Finder, see who else’s pricing you’ll be competing against.
- TAM SAM SOM Calculator, size your total addressable market before you plan how many units you need to sell.
- Competitor Analysis Template, see how competitors price and position before you set your own break-even assumptions.
Break-even by business type
- Food Business Ideas, thin margins make break-even math essential.
- Local Business Ideas
A break-even number is only as good as the demand behind it. IdeaCrystal checks whether people are actually searching for and buying what you’re pricing, before you bet fixed costs on it.
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