Break-Even Point Calculator
This break-even calculator finds how many units you need to sell — and the revenue that represents — before your business starts turning a profit, based on your fixed costs, price and variable cost per unit. Enter your numbers to find your break-even point.
Costs that don't change with sales volume — rent, salaries, insurance.
What you charge per unit sold.
The direct cost to produce or deliver one more unit.
Break-even units
667
How many units you need to sell to cover all costs.
How to use this break-even point calculator
- 1Fixed costs: expenses that stay the same regardless of how much you sell — rent, salaries, insurance, loan payments.
- 2Price per unit: what you charge customers for one unit of your product or service.
- 3Variable cost per unit: the direct cost that scales with each additional unit — materials, direct labor, packaging.
Understanding your results
Break-even units is the sales volume where total revenue exactly equals total costs — below this, you're operating at a loss; above it, every additional unit contributes to profit. Contribution margin shows what percentage of each sale actually goes toward covering fixed costs (and eventually profit) after variable costs are paid.
The formula
Break-even units = Fixed costs ÷ (Price per unit − Variable cost per unit)Each unit sold contributes its 'contribution margin' (price minus variable cost) toward covering fixed costs. Dividing total fixed costs by that per-unit contribution tells you exactly how many units are needed before those contributions add up to cover every fixed cost — the point where profit turns from negative to positive.
A worked example
$20,000 in fixed costs, a $50 price per unit, and a $20 variable cost per unit gives a $30 contribution margin (60%). Break-even is $20,000 ÷ $30 ≈ 667 units, or about $33,333 in revenue — sell fewer than that and you're at a loss; sell more and each additional unit adds $30 straight to profit.
Notes for the UK, US and India
A lower break-even point (achieved by cutting fixed costs, raising prices, or lowering variable costs) means less sales risk and faster path to profitability — useful to model before launching a new product or pricing tier, since it shows exactly how sensitive profitability is to each lever.
Frequently asked questions
What happens if my variable cost is higher than my price?+
The business can never break even at that price point — every unit sold loses money regardless of volume. This signals a pricing or cost structure problem that needs fixing before scaling sales.
Does lowering fixed costs or raising prices help more?+
Both lower the break-even point, but their leverage differs — a price increase improves the contribution margin on every unit sold (compounding with volume), while a fixed cost cut is a one-time reduction in the numerator. Model both to see which moves your specific break-even point further.
Should I include my own salary in fixed costs?+
If you draw a fixed salary from the business, yes — include it as a fixed cost so your break-even reflects the true cost of running the business, not just its out-of-pocket cash costs.
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