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Business Break-Even Calculator

Find exactly how many units and how much revenue you need to cover your costs — and what it takes to hit a target profit. See the loss and profit zones on a clear break-even chart.

Unit economics

What you charge the customer for one unit.

$

Cost that scales with each unit sold (materials, shipping, fees).

$

Costs that stay the same regardless of volume (rent, salaries).

$
Targets (optional)

Units you expect to sell, to check the resulting profit.

A profit goal on top of covering all costs.

$

Break-even point

Enter a selling price per unit greater than zero.

Enter a selling price per unit greater than zero.

What is a break-even calculator?

A break-even calculator tells you the point at which your sales cover all of your costs. It is one of the most useful numbers in business: it sets a minimum target for pricing, volume and budgeting, and it shows how much room you have before a price cut or cost increase pushes you into a loss.

How does it work?

Enter your selling price per unit, your variable cost per unit and your total fixed costs. Optionally add a sales target and a desired profit. The calculator computes your contribution margin, your break-even in units and revenue, and how many units you need to reach your profit goal — then plots the loss zone, break-even point and profit zone.

The formulas

  • Contribution margin per unit = Selling price − Variable cost
  • Break-even units = Fixed costs ÷ Contribution margin per unit
  • Break-even revenue = Break-even units × Selling price
  • Units for desired profit = (Fixed costs + Desired profit) ÷ Contribution margin per unit

Example

You sell a product for $100 with $60 of variable cost, giving a $40 contribution margin (40%). With $4,000 of monthly fixed costs, you break even at 100 units, or $10,000 of revenue. To earn an extra $2,000 of profit you would need to sell 150 units. The chart shades everything below 100 units red (loss) and everything above green (profit).

Why the contribution margin matters

A higher contribution margin means each sale does more work to cover your fixed costs, so you break even sooner and profit accelerates faster once you pass it. Raising prices or reducing per-unit costs both widen the margin. If your margin is thin, small changes in price or cost have an outsized effect on how many units you must sell.

Who should use it?

  • New businesses pricing a product or service for the first time.
  • Owners deciding whether a price change or promotion is worth it.
  • Anyone setting realistic monthly sales targets.

Limitations

The model assumes a constant selling price and variable cost per unit and a fixed cost base that does not change with volume. In reality, bulk discounts, stepped costs and price tiers can shift the point. Use the result as a clear baseline, then sense-check it against your real cost behaviour. Pair it with our business profit calculator to model profit beyond break-even.

Frequently asked questions

What is the break-even point?

The break-even point is the sales volume at which total revenue equals total costs, so profit is exactly zero. Below it you make a loss; above it you make a profit. It is measured in units and in revenue.

How do you calculate break-even units?

Break-even units = Fixed costs ÷ Contribution margin per unit, where contribution margin per unit = Selling price − Variable cost. For example, $4,000 of fixed costs and a $40 contribution margin give a break-even of 100 units.

What is contribution margin?

Contribution margin is the money left from each sale after variable costs, available to cover fixed costs and then profit. It can be expressed per unit (price minus variable cost) or as a percentage of the selling price.

What if my variable cost is higher than my selling price?

Then every sale loses money and there is no break-even point at that price — you would only lose more by selling more. The calculator detects this and asks you to raise your price or lower your variable cost instead of returning a misleading number.

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Disclaimer. This calculator provides estimates for informational purposes only. Results are based on the information you enter and the assumptions used by the calculator. Actual financial, tax, business valuation, lending, marketplace or investment outcomes may differ. Consider consulting a qualified professional for decisions involving significant amounts of money.