Break-Even Point Calculator
Enter your fixed costs for the period (rent, salaries, subscriptions), your unit selling price and your unit variable cost (materials, shipping, commissions); the tool instantly shows how many units — and how much revenue — you need to stop losing money. The heart of the calculation is the contribution margin: what each sale leaves toward fixed costs after its own variable cost. Add a target profit to see the sales volume that achieves it — a practical sanity check for pricing and capacity decisions.
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Frequently asked questions
How is the break-even point calculated?
Break-even units = Fixed costs ÷ (Unit price − Unit variable cost). Example: 50,000 in fixed costs, a price of 25 and variable cost of 15 → contribution margin 10, break-even at 5,000 units or 125,000 in revenue. Below that volume the period ends at a loss.
What are contribution margin and its ratio?
Contribution margin = unit price − unit variable cost: the part of each sale left for fixed costs and profit. The ratio divides it by the price: a 10 margin on a 25 price is 40% — 40 cents of every revenue unit remain after variable costs.
How many sales do I need for a target profit?
(Fixed costs + Target profit) ÷ Contribution margin. In the example above, a 20,000 profit requires (50,000 + 20,000) ÷ 10 = 7,000 units.
What if the variable cost exceeds the price?
Then the contribution margin is negative and no break-even point exists — every sale deepens the loss. Fix the unit economics first: raise the price, cut variable costs or change the product mix. The tool flags this case with an explicit warning.