⚖️ Break-Even Point Calculator

Enter your fixed costs, variable cost per unit and selling price per unit to find how many units you need to sell to cover your costs. This is a general calculation, not financial advice.

Fixed costs (total)

Variable cost per unit

Selling price per unit

The break-even formula

Everything on this page comes from the gap between price and variable cost:

contribution per unit = selling price - variable cost per unit
break-even units      = fixed costs / contribution per unit
break-even revenue    = break-even units × selling price
contribution margin % = contribution / selling price × 100

With the defaults - $5,000 of fixed costs, $20 variable cost, $45 price - each sale contributes $25, which is a 55.56% margin. You need 5,000 / 25 = 200 units, or $9,000 of revenue, to cover your costs. Units are rounded up, since you cannot sell 199.4 of something, and the exact figure is shown beside it.

Sorting fixed from variable

Fixed costs are the ones the month bills you for whether you sell nothing or everything: rent, insurance, salaries, software, loan payments. Include your own pay if you need to live on the business.
Variable costs attach to a single unit: materials, packaging, shipping, payment processing fees, sales commission.
If a cost is partly both, such as a phone plan with overage, split it or put the whole thing in fixed and accept a slightly conservative answer.

Fixed costs are only fixed over a range. Passing 200 units might mean a second oven, another van, or a first employee, which lifts the fixed line and moves break-even up in a step rather than a smooth curve. The model also assumes one price for every unit, so discounts, bulk deals and refunds all push the real figure higher.

Frequently asked questions

How do I calculate the break-even point in units?

Divide total fixed costs by the contribution per unit. $5,000 of fixed costs and $25 of contribution gives 200 units. Halve the contribution to $12.50 and you need 400.

What is contribution margin?

The money left from one sale after the costs of making that sale. At $45 a unit with $20 of variable cost, $25 contributes towards fixed costs, or 55.56% of the price. Once fixed costs are covered, that $25 is profit.

Why does it say I can never break even?

Your selling price is at or below your variable cost, so contribution is zero or negative and every extra sale deepens the loss. Volume cannot fix that; the price or the unit cost has to change.