Business
Find the sales volume needed to cover fixed costs.
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Break-even calculator guide
Break-even is the number of units you must sell before revenue covers every fixed cost and the next sale becomes profit. This calculator takes your fixed costs for the period, the selling price per unit, and the variable cost per unit, works out the contribution each unit makes toward fixed costs, and divides fixed costs by that contribution. Because you cannot sell a fraction of a unit, the result is rounded up to the next whole unit and the matching break-even revenue is shown alongside it. Use it when pricing a new product, deciding whether a market stall or event is worth the fee, or checking how many subscriptions a service needs before it pays for itself. The figure excludes income tax, sales tax, payment-processing fees, financing costs, refunds, and any limit on how many units you can actually produce or sell in the period, so treat it as the floor a plan has to clear rather than a forecast.
Contribution per unit ($) = price per unit ($) − variable cost per unit ($). Break-even units = fixed costs ($) ÷ contribution per unit, rounded up to a whole unit. Break-even revenue ($) = break-even units × price per unit.
Worked example with the default inputs: fixed costs of $5,000, a price of $50 per unit, and a variable cost of $20 per unit. Contribution per unit = $50 − $20 = $30. Break-even units = $5,000 ÷ $30 = 166.67, which rounds up to 167 units because a partial unit cannot be sold. Break-even revenue = 167 × $50 = $8,350.00. Selling 166 units would leave $20 of fixed cost uncovered; unit 168 is the first sale that is pure contribution to profit.
Enter all three fields in the same currency, and make sure fixed costs cover the same period you are counting sales for, whether that is a month, a season, or one event. Price and variable cost are per single unit; if you sell in packs, either treat the pack as the unit or divide both figures by the pack size. The calculator does not convert currencies or annualise a monthly figure.
The result is a planning figure that depends entirely on the assumptions you entered. Fees, taxes, payment timing, and rate changes are not captured unless you built them into the inputs, and small errors in a rate compound quickly over time. Verify the rates and terms against your own agreements or your accountant before making a commitment. On this page the figure rests entirely on fixed costs, price per unit and variable cost per unit, so start there if the break-even calculator returns something you did not expect.
Good to know: the most common error is putting a cost in the wrong bucket. Rent, insurance, software subscriptions, and salaried staff are fixed for the period; materials, packaging, shipping, and per-sale payment fees are variable. If price does not exceed variable cost, contribution is zero or negative and no volume will break even, which the calculator flags rather than showing a number. Do not use list price if most sales go out at a discount; use the realistic average selling price.
Use the result for planning, then confirm taxes, fees, contract terms, and other business-specific assumptions. This is not accounting, tax, or investment advice.
How it works
Find the sales volume needed to cover fixed costs. This tool explains the calculation so you can adjust the assumptions to match your situation.
Worked example
With Fixed costs = 5000 $ · Price per unit = 50 $ · Variable cost per unit = 20 $ → 167 units (units to break even). Change an input above and this example updates with your numbers.
Common questions
Subtract variable cost per unit from price per unit to get the contribution per unit, then divide total fixed costs by that contribution. Round up to the next whole unit, because a fraction of a unit cannot be sold and would leave part of fixed costs uncovered.
It depends on the contribution per unit. With a $50 price and $20 variable cost, contribution is $30, so $5,000 ÷ $30 = 166.67, rounded up to 167 units or $8,350 in revenue. Halving fixed costs to $2,500 cuts break-even to 84 units.
Fixed costs stay the same whether you sell one unit or a thousand in the period: rent, insurance, salaries, subscriptions, equipment leases. Variable costs rise with every unit: materials, packaging, per-transaction fees, shipping, sales commission. Some costs are semi-variable; put the stable part in fixed and the per-unit part in variable.
No. The result excludes income tax, sales tax or VAT collected on behalf of the government, loan interest, refunds, and chargebacks. If card-processing fees are charged per sale, add them to variable cost per unit so the contribution figure is realistic.
Raise the contribution per unit or cut fixed costs. A higher price, a cheaper supplier, or lower packaging cost each widen the gap between price and variable cost. Renegotiating rent or moving a subscription to a cheaper tier reduces the fixed total that has to be covered.