Break-Even Point Calculator
Find the break-even point in units and revenue from fixed costs, price per unit, and variable cost per unit. Educational. Runs in your browser.
Fixed costs stay the same regardless of volume (rent, salaries). Variable cost is the per-unit cost that scales with sales.
Break-even units = fixed costs ÷ contribution margin per unit (price − variable cost). Below this volume the business loses money; above it, each additional unit adds its full contribution margin to profit. Break-even revenue = break-even units × price (equivalently, fixed costs ÷ contribution-margin ratio). Educational; everything runs in your browser.
About this tool
The break-even point is the level of sales at which a business exactly covers its costs — total revenue equals total costs, so profit is zero. Sell one unit more and you start making money; one fewer and you lose it. The calculation rests on splitting costs into two kinds. Fixed costs stay the same no matter how much you sell — rent, salaries, insurance, software subscriptions. Variable costs scale with each unit — materials, packaging, shipping, payment fees. The gap between the selling price and the variable cost of one unit is the contribution margin: the amount each sale 'contributes' toward paying off the fixed costs. Break-even units is then simply fixed costs divided by that per-unit contribution margin, because that is how many units' worth of contribution you need to fully absorb the fixed costs. Multiply break-even units by price to get break-even revenue (equivalently, fixed costs divided by the contribution-margin ratio). The break-even point is one of the first numbers a founder or product manager should know: it sets the minimum viable sales target, frames pricing decisions (a higher price or lower variable cost both lower the break-even volume), and clarifies how much risk a fixed-cost commitment adds. It assumes price and costs stay constant across the volume range, which is a reasonable simplification for planning. This is educational. Everything runs in your browser; nothing is uploaded.
How to use it
- Enter total fixed costs for the period (rent, salaries, overhead).
- Enter the selling price per unit.
- Enter the variable cost per unit — costs that scale with each sale.
- Read the break-even units and revenue; sales above that level turn a profit.
Frequently asked questions
- How is the break-even point calculated?
- Break-even units = fixed costs ÷ contribution margin per unit, where contribution margin = price − variable cost per unit. For $10,000 fixed costs, a $50 price, and $30 variable cost, the margin is $20 and break-even is 500 units ($25,000 revenue).
- What is break-even revenue?
- The sales dollars needed to break even: break-even units × price, or equivalently fixed costs ÷ contribution-margin ratio. It is useful when you think in revenue targets rather than unit counts.
- What is the difference between fixed and variable costs?
- Fixed costs do not change with sales volume — rent, salaries, insurance. Variable costs rise and fall with each unit — materials, shipping, payment fees. Only the split between them determines the break-even point.
- Why round break-even units up?
- Because you cannot sell a fraction of a unit, and selling the exact fractional amount would leave you slightly short of covering fixed costs. Rounding up gives the first whole-unit volume that reaches or clears break-even.
- How can I lower my break-even point?
- Three levers: reduce fixed costs, raise the price, or cut the variable cost per unit. Raising price or cutting variable cost increases the contribution margin, so fewer units are needed to cover fixed costs.
- Is anything uploaded?
- No. All calculations run entirely in your browser.