Estimate how many products you need to sell or hours you need to bill to cover costs and reach a target profit.
Rent, salaries, insurance, software subscriptions, etc.
Materials, packaging, direct labor, commissions, etc.
To calculate true after-tax profit targets.
Enter your fixed costs, variable costs, and selling price to see your break-even point.
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A break-even calculator determines the exact point where your total revenue equals total costs—the moment your business stops losing money and starts making profit. It divides your fixed costs by the contribution margin (selling price minus variable cost per unit) to find the number of units you must sell.
Small business owners launching a product, freelancers pricing services, startup founders creating financial projections for investors, and e-commerce sellers evaluating new product lines. Also useful for side hustlers deciding whether an idea is financially viable.
Example Input
Fixed costs: $8,000/month (rent, utilities, insurance). Variable cost per unit: $1.50 (cup, beans, milk). Selling price: $5.00 per coffee.
Sample Output
Break-even point: 2,286 coffees/month (77/day). Monthly revenue needed: $11,429. Every coffee sold above 2,286 generates $3.50 in pure profit.
Example Input
Fixed costs: $25,000/month (salaries, hosting, tools). Variable cost per customer: $5/month. Subscription price: $49/month.
Sample Output
Break-even point: 568 paying customers. Monthly revenue target: $27,832. At current growth rate of 50 customers/month, break-even in ~11 months.
Use it before launching a new product to validate pricing. Run it when negotiating a commercial lease to understand how rent affects profitability. Recalculate quarterly as your costs and pricing evolve. Compare scenarios with our budget planner.
Separate truly fixed costs (rent, insurance) from semi-variable costs (marketing, shipping). Include all variable costs per unit, not just materials—packaging, payment processing fees (2.9%), and shipping. Test multiple price points to find the optimal balance between volume and margin.
Forgetting to include your own salary as a fixed cost. Underestimating variable costs by ignoring returns, refunds, and payment processing fees. Assuming 100% capacity utilization—realistically, businesses operate at 60-80% capacity.
Break-Even Point (units) = Fixed Costs ÷ (Selling Price per Unit - Variable Cost per Unit). The denominator is called the 'contribution margin' because it represents how much each sale contributes toward covering fixed costs.
Fixed costs remain constant regardless of sales volume (rent, insurance, salaries). Variable costs change proportionally with each unit sold (raw materials, shipping, sales commissions). Understanding this distinction is critical for accurate break-even analysis.
For most small businesses, breaking even within 12-18 months is considered healthy. Tech startups often take 2-3 years. If your analysis shows break-even beyond 3 years, reconsider your pricing, cost structure, or business model.
Stress-test unit economics and contribution margins with instantaneous calculations. Experiment with fixed overhead, pricing tiers, and variable cost assumptions locally in your browser before committing capital to a new venture.
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