Break-Even Calculator
It finds the number of units you must sell before a business or product stops losing money, along with the revenue that represents.
Units to break even
5,000
Contribution margin
$10.00
Margin %
40.0%
Break-even units
5,000
Break-even revenue
$125,000
Profit at 6,000
$10,000
Fixed costs
$50,000
What it calculates
It finds the number of units you must sell before a business or product stops losing money, along with the revenue that represents.
Why it matters
Break-even is the single number that tells you whether a price is viable. If the volume required is more than the market can absorb, the pricing is wrong.
Who it's for
Founders pricing a product, small business owners assessing a new line, and anyone writing a business plan.
Formula
- F
- Fixed costs that do not vary with volume
- P
- Selling price per unit
- V
- Variable cost per unit
- CM
- Contribution margin = P − V
Worked example
$50,000 fixed costs, $25 price, $15 variable cost
- 1Contribution margin = 25 − 15 = 10
- 2Units = 50,000 ÷ 10
- 3Revenue = 5,000 × 25
5,000 units, or $125,000 in revenue, to break even
How the break-even calculator works
Every unit sold contributes its price minus its variable cost toward the fixed costs. Once those contributions add up to the fixed cost total, you break even; every unit after that is profit at the contribution margin. If price is below variable cost the margin is negative and no volume will ever break even — selling more only loses more.
Every unit sold contributes its price minus its variable cost toward fixed costs. Once those contributions cover the fixed total you break even, and every unit after that is profit at the contribution margin.
If price sits below variable cost the margin is negative and no volume ever breaks even — selling more only loses more.
Common mistakes
- Classifying a cost as fixed when it scales with volume, which understates the break-even point.
- Forgetting your own salary in fixed costs.
- Assuming price is fixed — cutting price raises the break-even volume sharply because it comes straight off the margin.
Tips and best practice
- A price rise moves break-even far more than a cost cut of the same size, because it lands entirely on the margin.
- Model break-even at your worst realistic price, not your best.
Frequently asked questions
What is the break-even formula?
Break-even units = fixed costs ÷ (price per unit − variable cost per unit). The denominator is the contribution margin.
What is contribution margin?
The amount each sale contributes toward fixed costs and profit: selling price minus variable cost per unit.
What if my price is below variable cost?
There is no break-even point. Every sale loses money, so volume makes the loss larger. Either the price or the cost structure has to change.
Are fixed costs really fixed?
Only within a range. Rent is fixed until you need a second warehouse — economists call these step costs, and they reset the break-even point when crossed.
Related calculators
Methodology & trust
- Formula source
- Standard cost-volume-profit analysis.
- Last updated
- 2026-07-28
- Privacy
- Every calculation runs in your browser. No inputs are sent to a server or stored.
- Accessibility
- Keyboard navigable, labeled inputs and WCAG AA color contrast.