Break-Even Calculator

The break-even point is the number of units you need to sell for total revenue to equal total costs, meaning zero profit and zero loss. Beyond this point, each additional sale generates profit. It is a fundamental metric for business planning and pricing decisions.

Break-even units equal fixed costs divided by the contribution margin per unit (selling price minus variable cost per unit). For example, with $10,000 fixed costs, a $50 selling price, and $30 variable cost, you need to sell 500 units to break even.

Contribution margin is the selling price minus the variable cost per unit. It represents how much each unit sold contributes toward covering fixed costs and generating profit. A higher contribution margin means fewer units are needed to break even.

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Fixed costs remain constant regardless of production volume, such as rent, insurance, and salaries. Variable costs change with each unit produced, including raw materials, packaging, shipping, and sales commissions.