Break-even Calculator

The break-even point is the number of units you must sell to cover all fixed costs. After that, every sale contributes profit.

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Break-even units334
Break-even revenue$13,360
Contribution per unit$18.00
Contribution margin45.0%
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What is break-even?

Break-even units = fixed costs ÷ (price − variable cost per unit). The gap between price and variable cost is the contribution margin each unit adds.

How to use the break even calculator (formula)

Break-even units = ceil(Fixed costs (per month) ÷ (Selling price per unit − Variable cost per unit)) Break-even revenue = Break-even units × Selling price per unit Contribution per unit = Selling price per unit − Variable cost per unit Contribution margin = Contribution per unit ÷ Selling price per unit × 100

What each field means

  • Fixed costs (per month) — Monthly costs that do not change with sales (rent, salaries, tools).
  • Selling price per unit — Selling price per unit.
  • Variable cost per unit — Cost per unit sold (product, shipping, ad cost per unit).

Worked example

Using these numbers: fixed costs (per month) $6,000, selling price per unit $40.00, variable cost per unit $22.00.

The break-even units is 334.

  • Break-even revenue: $13,360
  • Contribution per unit: $18.00
  • Contribution margin: 45.0%

How should I use break-even analysis?

Use it before launching products or raising fixed costs. If break-even units are far above realistic monthly sales, change price, cost or plan.

Tips to improve your result

  • Include ad cost per unit as a variable cost.
  • Recalculate when you hire or add tools.
  • Raising price lowers break-even faster than cutting small costs.
  • Compare break-even with your average monthly sales.

Frequently asked questions

What is the break-even formula?

Fixed costs ÷ (selling price − variable cost per unit).

What is contribution margin?

Price minus variable cost — what each unit adds toward fixed costs.

Are ads fixed or variable costs?

Usually variable — treat ad cost per sale as part of variable cost.

How do I reach break-even faster?

Raise price, lower variable cost or reduce fixed costs.

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