Break-even Calculator
The break-even point is the sales volume where your total revenue exactly equals your total costs - you are making neither a profit nor a loss. This calculator finds that point in units and in revenue, and also shows your contribution margin per unit.
Rent, salaries, insurance - costs that don't change with volume.
Materials, packaging - costs that vary with each unit sold.
How to calculate a break-even point
Each unit sold first covers its variable cost; the remainder (contribution margin) goes toward fixed costs. When accumulated contributions equal total fixed costs, you have broken even. Every unit sold beyond that point is profit.
Break-even units = Fixed costs / (Price - Variable cost per unit)Example. Fixed costs of 5,00,000, variable cost of 200/unit and a price of 500/unit gives a contribution margin of 300 and a break-even point of 1,667 units (8,33,500 revenue).
Frequently asked questions
What counts as a fixed cost?
Costs that don't change with production volume: rent, salaries, insurance, loan repayments, software subscriptions. Variable costs change with each unit: raw materials, packaging, shipping per order, sales commission.
How does the break-even point change if I lower my price?
Lowering price reduces the contribution margin, so you need to sell more units to break even. Use the calculator to see the impact of different price points on your break-even volume.
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