Break Even Units
3,333
Break Even Revenue
$26,666.67
Contribution Margin
$3.00
How it works
The Break-Even Point Calculator determines the sales volume at which total revenue equals total costs — the point where a business neither profits nor loses. Enter your fixed costs, variable cost per unit, and selling price per unit to see the break-even units, break-even revenue, and margin of safety.
Every business decision with a cost component has a break-even point: how many units to sell to cover the cost of a new machine, how many clients to serve to cover a new hire's salary, how many events to run to cover venue costs, how many subscriptions to sell to cover development costs. This calculator answers those questions.
How to use it: enter total fixed costs (rent, salaries, insurance, software — costs that don't change with volume), variable cost per unit (materials, commission, shipping — costs that scale with each sale), and selling price per unit. The calculator returns: - Break-even units = fixed costs / (price − variable cost per unit) - Break-even revenue = break-even units × price - Contribution margin per unit = price − variable cost - Contribution margin ratio = contribution margin / price × 100 - Margin of safety = (actual/projected revenue − break-even revenue) / actual revenue
Multi-product break-even: for businesses with multiple products, enter a weighted average contribution margin based on your sales mix. The calculator shows the composite break-even point.
Scenario analysis: drag the target profit slider to see how many units must be sold to achieve any specific profit target: break-even units + (target profit / contribution margin per unit).
Privacy: all business calculations run in the browser.
Frequently Asked Questions
- Contribution margin is the selling price minus variable cost per unit: the amount each unit 'contributes' toward covering fixed costs and then generating profit. A $100 product with $60 variable cost has a $40 contribution margin. You need fixed costs / $40 units to break even. Once fixed costs are covered, every unit sold contributes $40 to profit.
- For services, define a unit as an hour of service, a client engagement, or a project. Enter fixed costs (office rent, salaries, insurance), average revenue per unit, and average variable cost per unit (direct labor hours, materials, contractor costs). The break-even analysis applies equally.
- Margin of safety = (actual sales − break-even sales) / actual sales × 100. It shows how much sales could decline before the business starts losing money. A 30% margin of safety means sales could drop 30% before reaching break-even — a comfortable buffer. A 5% margin of safety is dangerously close to loss territory.
- Raising the price increases the contribution margin per unit, which lowers the break-even point. Example: if you raise price from $100 to $110 with the same $60 variable cost, contribution margin increases from $40 to $50 (25% more). Break-even units decrease by 20%. Even a small price increase has a significant impact on break-even because fixed costs are unchanged.