Break-even Calculator
Find exactly how many units you need to sell before your business turns a profit.
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.