Break-Even Point Calculator
Find how many units you need to sell to cover fixed costs, from your price, variable cost per unit, and fixed costs.
- Break-even units
- 500
- Break-even revenue
- $25,000.00
- Contribution margin per unit
- $20.00
- Contribution margin ratio
- 40%
How it works
Each unit sold contributes its price minus its variable cost toward covering fixed costs — that per-unit amount is the contribution margin. The break-even point is simply fixed costs divided by contribution margin: break-even units = fixed costs ÷ (price − variable cost). Break-even revenue is that unit count times the price, and the contribution margin ratio expresses the same margin as a percentage of price.
Price per unit must be greater than variable cost per unit — if a product loses money on every single sale, no volume of sales can ever make up for it, so this calculator flags that instead of returning a nonsensical negative or infinite break-even count.
FAQ
What counts as a 'fixed' vs. 'variable' cost?
Fixed costs don't change with how many units you sell — rent, salaries, insurance. Variable costs scale with each unit produced or sold — materials, packaging, per-unit shipping. This calculator doesn't classify costs for you; it assumes you've already split them correctly.
Why does a small price increase move the break-even point so much?
Because price feeds into the contribution margin, which is the denominator of the break-even formula — a higher margin means fewer units are needed to cover the same fixed costs, and that relationship isn't linear, so small price changes near a thin margin can shift the break-even count sharply.