Break-even Calculator: Free Online Break-even Analysis Tool
Find the sales volume needed to cover all costs. Free online break-even calculator — your data stays in your browser, no account needed.
Your Numbers
Results update instantly as you type.
Break-even Point
834
units sold
= $83,333 in revenue
Contribution Margin
$60
per unit
Contribution Margin Ratio
60.0%
of revenue
Fixed Costs
$50,000
to cover
Break-even Revenue
$83,333
total sales needed
Variable Cost / Unit
$40
per unit sold
Selling Price / Unit
$100
per unit
Break-even Chart
Revenue and total cost vs. units sold. Profit begins where the lines cross.
- Revenue
- Total Cost
How Break-even Analysis Works
Break-even analysis tells you the minimum sales volume required to cover all costs — the point where total revenue equals total costs and profit is exactly zero. The core formula is:
Break-even Units = Fixed Costs ÷ (Selling Price − Variable Cost per Unit)
Key terms
- Fixed Costs — costs that don't change with output: rent, salaries, insurance, software subscriptions.
- Variable Costs — costs that increase with each unit: raw materials, packaging, payment processing fees.
- Contribution Margin — the amount each unit contributes toward covering fixed costs and generating profit. Formula: Price − Variable Cost.
- Contribution Margin Ratio — contribution margin as a percentage of selling price. Higher is better — it means more of each sale covers overhead.
How to use this for pricing decisions
- 📉Lower your break-even point by reducing fixed costs or increasing price.
- 📈Add a profit target to see exactly how many units generate the income you need.
- ⚖️Compare scenarios: a higher price raises the contribution margin and lowers break-even units.
- 💡If your variable cost is close to your selling price, your contribution margin is thin — a small drop in sales volume will push you into loss territory.
Reading the chart
The chart plots two lines against units sold: total revenue in blue, and total cost in red. Total cost starts above zero at your fixed-cost level even when you've sold nothing, then climbs at a rate set by your variable cost per unit. Revenue starts at zero and climbs faster, since every unit sold adds the full selling price. Where the two lines cross is your break-even point, marked with a dashed green reference line. Sell fewer units than that and the red line sits above the blue one, meaning you're operating at a loss. Sell more and the blue line pulls ahead, meaning each additional unit adds pure profit on top of covered costs. If you've entered a profit target, a second dashed line marks the unit count where you clear that target, not just break even.
Common use cases
A founder pricing a new product plugs in expected fixed costs, a proposed selling price, and the cost to produce one unit, then checks whether the resulting break-even volume is realistic given market size. A restaurant owner deciding whether to add a new menu item runs the same numbers with ingredient cost as the variable input and a share of monthly rent and staff wages as the fixed input. A freelancer setting hourly rates treats "units" as billable hours and fixed costs as software subscriptions, insurance, and other overhead that doesn't scale with client work. In each case, the calculator turns a vague "will this be profitable" question into a specific number: sell this many units, or don't launch.
Tips for accurate numbers
- •Include every fixed cost, not just the obvious ones. Software subscriptions, insurance, and loan payments count as much as rent.
- •Match your fixed-cost period to your planning horizon. Use monthly fixed costs if you're planning monthly sales, annual if you're planning annual sales.
- •Don't forget payment processing fees, shipping, and packaging in your variable cost. They're easy to leave out and they shrink your contribution margin.
- •Re-run the numbers whenever a supplier raises prices or you renegotiate rent. Break-even isn't a one-time calculation; it shifts with your cost structure.
You're not limited to a single scenario. Because every field updates the results the moment you type, you can test a higher price against a lower one, or see how much a rent increase moves your break-even units, in the time it takes to change a number. All the math happens in your browser, and your inputs are saved to local storage automatically so the numbers are still there next time you open the page.
Break-even vs. profit target
Break-even tells you the point where you stop losing money, not the point where the business becomes worth running. That's what the profit target field is for. Enter the amount you want to earn, whether that's a personal salary you need to draw from the business or a return you promised investors, and the calculator adds it on top of fixed costs before dividing by the contribution margin. The result is a second, higher unit count and a second reference line on the chart, so you can see the gap between "surviving" and "hitting your number" as a concrete volume of sales rather than an abstract goal.
Limitations to keep in mind
This model assumes fixed costs stay fixed and variable costs stay proportional to units sold, which holds for many small businesses but breaks down at scale. Bulk discounts from suppliers lower your variable cost per unit as volume grows. Hiring more staff to handle higher volume turns what looked like a fixed cost into a step function that jumps at certain thresholds. And the model says nothing about demand: it tells you how many units you need to sell, not whether the market will buy that many at your chosen price. Treat the output as a planning baseline, then sanity-check it against what you know about your market and your supplier agreements.
Related: Profit Margin Calculator to find margin on each unit sold, or Commission Calculator if your cost structure includes sales commissions.
Frequently Asked Questions
Is the Break-even Calculator free?
Yes — completely free. No account, no subscription, and no data is sent to a server.
Does it store my business data?
No data leaves your device. All calculations run in your browser. Nothing is sent to a server.
Do I need an account?
No account, no login, and no signup required.
What is a contribution margin?
The contribution margin is the selling price minus the variable cost per unit. It represents how much each sale contributes toward covering fixed costs. Once total contributions equal total fixed costs, you have reached break-even.
How do I lower my break-even point?
Three levers: reduce fixed costs (overhead, rent, subscriptions), reduce variable costs per unit (materials, processing fees), or increase your selling price. Raising price has the largest impact on the contribution margin, but it may affect demand.
What is a profit target and how does it affect the calculation?
A profit target is the amount you want to earn above break-even. Adding a target shifts the break-even point upward — you need to sell more units to cover costs plus generate your desired profit.