Break Even Calculator
Calculate your break-even point in units and revenue.
Find out how many units you need to sell to cover your costs.
Break-Even Point
Break-even analysis determines the point where total revenue equals total costs — meaning no profit and no loss.
Break-Even Units = Fixed Costs / (Price per Unit - Variable Cost per Unit)
Break-Even Revenue = Break-Even Units × Price per Unit
Where:
- Fixed Costs = Costs that don’t change with production (rent, salaries, insurance)
- Price per Unit = Selling price of each unit
- Variable Cost per Unit = Cost that changes per unit (materials, labor, shipping)
- Contribution Margin = Price per Unit - Variable Cost per Unit
For example, with $50,000 in fixed costs, $25 price, and $10 variable cost:
- Contribution margin = $25 - $10 = $15 per unit
- Break-even units = $50,000 / $15 = 3,334 units
- Break-even revenue = 3,334 × $25 = $83,350
Key insights:
- A higher price or lower variable cost reduces your break-even point
- Reducing fixed costs is the most direct way to lower break-even
- The contribution margin ratio (
(Price - Variable Cost) / Price) shows what percentage of each sale covers fixed costs