Break-Even Calculator
Enter what your business costs to run, what you sell one unit for, and what that unit costs you. The calculator shows how many you have to sell before you stop losing money, and the revenue that represents. Add a profit target to see the sales needed to actually earn something. It is the check to run before you sign a lease, book a market stall, launch a product or change a price. If you have not settled on a price yet, the markup calculator gets you from cost to selling price first.
When to use this calculator
Use this when a new fixed cost is on the table — a studio, a stall fee, a subscription, a piece of equipment — and you need to know how many sales it takes to justify it. Also use it to set a monthly sales target, or to test whether a product is worth launching at the volume you can realistically reach.
Use the same period for fixed costs and target profit — both per month, or both per year. The units shown are for that period.
Break-even Units
Break-even Revenue
Profit per Unit Toward Fixed Costs
Units for Target Profit
Results are instant — nothing is stored and no account is needed.
What If I Change My Price?
A higher price loses some customers and a lower one has to win more. The question is how many. Enter your current price and the one you are considering: you will see the break-even point at each, and how much your sales can fall — or must rise — for your profit to stay where it is today. Raising a $25 product with a $10 cost to $30, for example, lets you lose a quarter of your sales before you are worse off.
Break-even Now
Break-even at New Price
Related Calculators
How to Calculate
- Add up your fixed costs for one period, usually a month: rent, software, insurance, your own pay.
- Work out the variable cost of one unit: materials, packaging, postage and fees for that sale.
- Subtract the variable cost from the selling price to get the contribution per unit.
- Divide fixed costs by the contribution per unit. Round up — you cannot sell part of a unit.
- Multiply the units by the selling price for break-even revenue.
Formula
For a profit target, add it to the fixed costs first: Units = (Fixed Costs + Target Profit) / (Selling Price − Variable Cost). With $1,200 fixed, $900 target, $25 price and $10 variable cost: $2,100 / $15 = 140 units.
Examples
Fixed $1,200, sell $25, variable $10
80 units — $2,000 revenue
Fixed $600, sell $16.50, variable $7.50
67 units — $1,100 revenue
Fixed $10,000, sell $80, variable $30
200 units — $16,000 revenue
Use Cases
- Deciding whether a market stall or studio rent is worth taking on
- Setting a monthly sales target you can track against
- Testing whether a new product can pay for its own tooling or stock
- Seeing how a price rise or a discount moves the goalposts
- Working out how long equipment takes to pay for itself
FAQ
What is the break-even formula?
Break-even units = Fixed costs / (Selling price − Variable cost per unit). The bottom of that fraction is the contribution margin: what each sale puts toward your fixed costs. With $1,200 of fixed costs, a $25 price and a $10 variable cost, it is $1,200 / $15 = 80 units. The break-even guide works through a full example, including a daily sales target.
Should I count my own pay as a fixed cost?
Yes, if you need the business to pay you. A break-even point that leaves out your wage only tells you when the business stops losing money, not when it supports you. Adding a $1,500 monthly draw to $1,200 of other fixed costs moves the example above from 80 units to 180.
Is the break-even point per month or in total?
It matches the period of the fixed costs you enter. Monthly rent and subscriptions give units per month; a year of costs gives units per year. For a one-off cost such as a $2,400 machine, divide it by the contribution you earn each month to get the number of months until it has paid for itself.
What are fixed costs and variable costs for a small seller?
Fixed costs are what you pay whether you sell anything or not: rent, insurance, software, a market stall fee, your own wage. Variable costs rise with every sale: materials, packaging, postage you pay, and marketplace or card fees. Fees charged as a percentage of the price are variable costs, not fixed ones.
How do I work out break-even when I sell several products?
Use a weighted average contribution. If 70% of your units are candles contributing $9 each and 30% are diffusers contributing $15, the average is 0.7 × $9 + 0.3 × $15 = $10.80. With $1,200 of fixed costs you need $1,200 / $10.80, about 112 units in that mix. If the mix shifts toward the lower-contribution product, the number goes up.
What is margin of safety?
It is how far sales can fall before you start losing money: (actual units − break-even units) / actual units. Selling 100 units against a break-even of 80 gives a 20% margin of safety. Below about 10% a single slow month can put you in the red.
How does break-even relate to profit margin?
Margin tells you what share of each sale is profit before overheads; break-even tells you how many of those sales it takes to cover the overheads. A product can have a healthy margin and still never break even if it sells too slowly. Check the per-sale figure with the profit margin calculator, then bring it here.
Advanced Scenarios
Fees that take a share of the price
A marketplace that keeps 10% of a $25 sale costs you $2.50 per unit. Add it to the variable cost: $10 becomes $12.50, the contribution drops from $15 to $12.50, and break-even on $1,200 of fixed costs rises from 80 units to 96. Leaving percentage fees out is the most common reason a break-even figure turns out too optimistic.
Running a promotion
Taking 20% off that $25 product makes it $20 and cuts the contribution from $15 to $10. Break-even moves from 80 units to 120, which is 50% more sales for a 20% discount. The seller tool on the discount calculator shows the same effect on profit per sale.
A one-off purchase
Equipment is not a monthly cost, so ask how long it takes to earn back. A $2,400 machine in a business that clears $800 a month after its regular costs pays for itself in three months. If the machine also lowers your variable cost, the payback is quicker — recalculate with the new cost per unit.
Selling through shops as well as direct
A wholesale sale brings in a lower price for the same variable cost, so its contribution is smaller. Work out break-even separately for each channel, or use a weighted average if the split is stable. The wholesale price calculator gives you the wholesale price to plug in.
Units Needed by Contribution per Unit
How many sales cover a given fixed cost, depending on what each sale contributes after its own costs.
| Contribution per unit | Units for $1,000 fixed | Units for $3,000 fixed |
|---|---|---|
| $2 | 500 | 1,500 |
| $5 | 200 | 600 |
| $10 | 100 | 300 |
| $15 | 67 | 200 |
| $25 | 40 | 120 |
| $50 | 20 | 60 |