Break-Even Calculator
Calculate how many units you need to sell to cover costs and start making profit with break-even analysis
Business Scenarios
Estimates based on the figures you enter. Nothing here is financial, legal or tax advice — check any material decision with a qualified adviser.
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Find Your Break-Even Point
Every business needs to know when they'll start making money. Our break-even calculator shows exactly how many units (or how much revenue) you need to cover your fixed and variable costs. Essential for pricing decisions and financial planning.
Understanding Break-Even Analysis
Break-even is the point where total revenue equals total costs—no profit, no loss. Above this point, every additional sale generates profit. Below it, you're operating at a loss. The calculation considers fixed costs (rent, salaries) and variable costs (materials, shipping).
Break-Even Formula
Break-Even Units = Fixed Costs / (Selling Price - Variable Cost per Unit)How to Calculate Break-Even
Enter total fixed costs (rent, insurance, salaries)
Enter variable cost per unit (materials, labor, shipping)
Enter selling price per unit
Optionally enter a target profit amount
See break-even units and revenue instantly
Common Use Cases
New Product Launch
Determine if a new product can be profitable at target price points.
Pricing Strategy
Find the minimum price needed to cover costs and make profit.
Business Planning
Set sales targets and evaluate business model viability.
Investment Decisions
Evaluate whether to expand capacity or add new offerings.
Why Calculate Break-Even?
Sales To Profit
Know exactly how many sales you need to profit
Minimum Pricing
Set minimum pricing to cover costs
Target Profit Planning
Plan for target profit levels
Viability Check
Evaluate business viability
Informed Pricing
Make informed pricing decisions
Frequently Asked Questions
Fixed costs don't change with production volume: rent, insurance, salaries, equipment leases, loan payments. You pay these whether you sell 0 or 1000 units. Accurately identifying fixed costs is crucial for break-even analysis.
Variable costs change with each unit produced: raw materials, direct labor, packaging, shipping, sales commissions. If making another unit costs $5 in materials, that's a variable cost.
Contribution margin is selling price minus variable cost. It's what each sale 'contributes' toward covering fixed costs and profit. Higher contribution margin means faster path to profitability.
Three ways: reduce fixed costs, reduce variable costs, or increase selling price. Each has tradeoffs—raising prices might reduce volume, cutting costs might affect quality. Find the right balance.
It's a useful model but has limitations. Real-world costs aren't always purely fixed or variable, prices may vary, and it assumes you sell everything you make. Use it as a planning tool, not a guarantee.