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.
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)
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.
You might also need
E-commerce Profit CalculatorNet profit and margin per order after product, shipping, fees and ads.
Break-even ROAS CalculatorThe minimum ROAS your margin allows.
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