Break-even Point Calculator
Calculate break-even units and revenue from fixed costs, variable cost, and price. Free to use, no signup required for occasional use.
What is the Break-even Point Calculator?
The Break-even Point Calculator tells you exactly how many units you need to sell, and how much revenue you need to generate, before your business starts turning a profit. It works from three inputs: your fixed costs (rent, salaries, and other expenses that don't change with sales volume), your variable cost per unit (the cost to produce or deliver one more unit), and your price per unit (what you charge customers). From these, the tool calculates your contribution margin — the amount each sale contributes toward covering fixed costs after variable costs are paid — and divides your fixed costs by that margin to find the break-even point in units. It also converts that into break-even revenue, so you know the sales target in dollars as well as units. This is one of the most fundamental calculations in small business planning, pricing strategy, and startup financial modeling, and it's useful whether you're launching a new product, evaluating a pricing change, or checking whether a business idea is financially viable before you commit real money to it.
How to use it
Enter your total fixed costs for the period you're analyzing — this should include rent, salaries, insurance, and any other cost that stays the same regardless of how many units you sell. Next, enter your variable cost per unit, which covers materials, direct labor, and any other cost that scales directly with production or sales volume. Finally, enter the price per unit you charge or plan to charge customers. Click 'Calculate' and the tool will show your break-even point in units and in revenue, along with your contribution margin per unit. If the price per unit is lower than or equal to your variable cost per unit, the calculation isn't possible — you'd lose money on every sale regardless of volume, so you'll need to raise your price or lower variable costs first.
Frequently asked questions
What's the difference between fixed and variable costs?
Fixed costs stay the same no matter how many units you sell (like rent), while variable costs change directly with production volume (like raw materials).
What is contribution margin?
It's the price per unit minus the variable cost per unit — the amount each sale contributes toward covering your fixed costs before you start making profit.
Can the break-even point change over time?
Yes, it changes whenever your fixed costs, variable costs, or price per unit change, so it's worth recalculating whenever any of those shift.
Is a lower break-even point always better?
Generally yes, since it means you need fewer sales to become profitable, but it should be considered alongside overall profit margin and market demand.