Break-Even Calculator
Every business has a line where sales finally cover all its costs — below it you lose money, above it you start making it. This free break even calculator finds that line for you: enter your fixed costs, your price per unit and your variable cost per unit, and it works out your contribution margin, the exact number of units you must sell to break even, and the revenue that represents. It works as a break even point calculator for product sellers and as a break even analysis calculator for services, shops, food businesses and freelancers who want to know how much work a month has to bring in before it pays for itself.
Costs & price
Frequently asked questions
What is the break-even point formula?
Break-even units = fixed costs ÷ (price per unit − variable cost per unit). The part in brackets is your contribution margin — what each sale contributes toward covering fixed costs. If your fixed costs are $4,000 a month, you sell at $50 and each unit costs $30 to make or deliver, your contribution margin is $20 and your break-even point is 4,000 ÷ 20 = 200 units a month. Multiply break-even units by price to get break-even revenue.
What counts as fixed vs variable costs?
Fixed costs stay the same whether you sell one unit or a thousand: rent, insurance, software subscriptions, salaried staff and equipment leases are common examples. Variable costs rise with each sale: materials, packaging, shipping, payment processing fees, hourly labor tied to a job and sales commissions. Some costs are mixed — for example a base utility bill plus usage — in which case put the fixed part in fixed costs and the per-sale part in variable cost.
How can I lower my break-even point?
There are three levers. Raise your price or shift sales toward higher-margin products, which increases contribution margin per unit. Reduce variable costs by renegotiating materials, packaging or shipping. Or cut fixed costs — smaller premises, fewer subscriptions, leaner overhead. Even a small change helps: with $4,000 fixed costs, lifting contribution margin from $20 to $25 drops the break-even point from 200 units to 160 units a month.
Related tools: check the margin on each sale with our profit margin calculator, or see what staff really add to fixed costs with the employee cost calculator.