Break-Even Calculator
Work out your business break-even: how many units and how much revenue you need to cover fixed and variable costs. Shows contribution margin and how much to sell to hit a profit goal.
Rent, salaries, subscriptions: what doesn't change with sales
Cost per sale: product, shipping, fee, packaging
How much profit you want this month
Enter fixed costs, price and variable cost per unit to find how many sales you need to break even.
How it's calculated
- contribution margin = price − variable cost
- break-even (units) = fixed costs ÷ contribution margin
- for goal = (fixed costs + profit) ÷ contribution margin
How to use it
- • Anything that doesn't change with volume is a fixed cost: rent, salary, software.
- • Variable cost is born with each sale: product, shipping, card fee.
- • The higher the contribution margin, the less you need to sell to break even.
- • Use the profit goal to turn break-even into a sales target.
How it works
How to calculate the break-even point
The break-even point is how much you need to sell for revenue to cover all costs exactly: no profit, no loss. First find the contribution margin per unit: selling price minus the variable cost (goods, shipping, marketplace commission, card fees, taxes). Then divide your monthly fixed costs by that margin: break-even units = fixed costs ÷ contribution margin.
Example: you sell at R$ 100 and each unit carries R$ 60 of variable cost, so the contribution margin is R$ 40 (40%). With R$ 20,000 in fixed costs per month (rent, payroll, platform), the break-even is 20,000 ÷ 40 = 500 units, or R$ 50,000 in revenue. Sell less than that and you operate at a loss.
To aim for a profit target, add the desired profit to fixed costs before dividing. Wanting R$ 8,000 of profit: (20,000 + 8,000) ÷ 40 = 700 units. The higher the contribution margin, the fewer units you need to turn a profit — which is why cutting variable cost or raising price lowers the break-even faster than simply selling more.
Price & margin
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FAQ
Frequently asked questions
- What is the break-even point?
- It is the sales level where revenue exactly covers all costs (fixed and variable) and profit is zero. Past that point, each extra sale starts generating profit. Below it, the business runs at a loss.
- How do you calculate the break-even point?
- Divide fixed costs by the contribution margin per unit (sale price minus variable cost per unit). The result is how many units you need to sell to break even. Multiply by the price to get break-even revenue.
- What is contribution margin?
- It's how much is left from each sale after paying that unit's variable costs, to help cover fixed costs. The higher the contribution margin, the fewer units you need to sell to break even.
- How do I use break-even to set goals?
- Add your desired profit to fixed costs and divide by the contribution margin: you get how many units to sell to hit the goal. The calculator does this in the profit-goal field.
