Break-Even Calculator
The break-even point is the sales volume at which total revenue exactly equals total costs — no profit, no loss. Below it you lose money on every batch of sales; above it you start to profit. This calculator turns your fixed costs, selling price, and per-unit variable cost into the exact number of units and the revenue you need to break even, in any currency.
- Variable cost
- Contribution margin
- Contribution margin / unit
- $20.00
- Break-even units
- 500
- Break-even revenue
- $25,000.00
Each unit contributes 20.00 toward fixed costs (a 40.0% contribution margin). Once you pass 500 units, every additional sale adds 20.00 of pure profit.
How it works
Every unit you sell brings in its price but also incurs a variable cost — materials, packaging, payment fees, shipping. The difference between the two is the contribution margin: the slice of each sale that is left over to cover your fixed costs. Fixed costs (rent, salaries, software, insurance) do not change with volume, so they sit as a lump sum that the contribution margin has to chip away at one unit at a time.
Divide the fixed costs by the contribution margin per unit and you get the number of units required to cover everything. Multiply that by the price and you get the break-even revenue. Because the math is currency-agnostic, you can switch the currency at the top of the page and the relationships hold exactly.
The contribution margin is the lever that matters most. Raising the price or trimming the variable cost widens the margin, which lowers the break-even point far faster than cutting fixed costs does. That is why pricing decisions and supplier negotiations often move the needle more than overhead cuts.
Break-even units = Fixed costs ÷ (Price per unit − Variable cost per unit). The denominator is the contribution margin per unit. Break-even revenue = Break-even units × Price per unit.
Worked example
Suppose your fixed costs are 10,000, you sell each unit for 50, and each unit costs 30 to make. The contribution margin is 50 − 30 = 20 per unit. Dividing 10,000 by 20 gives a break-even point of 500 units. At a price of 50, that is 500 × 50 = 25,000 in break-even revenue. Sell 501 units and you are 20 in profit; sell 600 and you bank 2,000 above break-even.
Things to watch out for
The model assumes price and variable cost stay constant across all units, which breaks down with volume discounts, tiered pricing, or step changes in fixed costs (for example, hiring a second shift). If the contribution margin is zero or negative, there is no break-even point — every sale loses money, and the calculator flags this. For multi-product businesses, compute a blended contribution margin weighted by sales mix, or run each product line separately.
Frequently asked questions
What is the contribution margin?+
It is the price of a unit minus its variable cost — the amount each sale contributes toward covering fixed costs and, after break-even, toward profit. A higher contribution margin means a lower break-even point.
How do I lower my break-even point?+
Raise the price, reduce the variable cost per unit, or cut fixed costs. Widening the contribution margin (price up or variable cost down) usually moves the break-even point more than trimming overhead.
Does break-even include profit?+
No. Break-even is the zero-profit point. To find the volume needed for a target profit, add that profit to your fixed costs before dividing by the contribution margin.
Can I use this for a service business?+
Yes — treat one billable hour, project, or subscription as a "unit", with its price and variable cost. The same contribution-margin logic applies to any currency.
Related calculators
Disclaimer: This calculator is for educational and informational purposes only and provides estimates, not financial advice. Interest rates, taxes, fees, and local rules vary and change over time. Confirm figures with a qualified professional before making any financial decision.
Last reviewed: 2026-06-22