Break-Even Calculator
Find out exactly how many units you need to sell. or how much revenue you need. to cover all your costs and start making profit.
Break-Even Analysis
Starting a new business?
Get your LLC formed and protect your personal assets before your first sale. Formation services handle the legal paperwork in 1-2 days.
Form Your LLC. $0 + State Fees →How to Use This Calculator
Enter your total monthly fixed costs. these are expenses you pay regardless of how many units you sell. Common fixed costs include rent, insurance premiums, loan payments, employee salaries, and software subscriptions.
Then enter your selling price and variable cost per unit. Variable costs are expenses that scale with each sale: raw materials, packaging, shipping, payment processing fees, and sales commissions.
The calculator shows your contribution margin (the profit per unit before fixed costs), the number of units needed to break even, and the total revenue required. If you add a target profit, it shows how many units you need to hit that goal.
Break-Even Formula Explained
The break-even formula is straightforward: divide your fixed costs by the contribution margin per unit. Contribution margin is what's left from each sale after variable costs. the money that "contributes" to covering fixed costs.
Once you sell enough units for the total contribution margin to equal your fixed costs, you've broken even. Every unit sold after that point is pure profit (minus variable costs per unit).
The contribution margin ratio tells you what percentage of each revenue dollar goes toward covering fixed costs. A 60% ratio means $0.60 of every dollar in revenue covers overhead and profit. Higher is better.
Note: This calculator provides estimates for planning purposes only. Actual break-even points depend on many factors including seasonal demand, variable cost fluctuations, and market conditions. This tool is not financial advice. Consult a qualified accountant for decisions about your business.