Break-Even Calculator
Find how many units you must sell to cover your costs.
What you provide
Result
Break even at 334 units
Each unit contributes 15 toward the fixed cost of 5000. You cover it after selling 334 units; every sale after that is profit.
- Units to break even
- 334
- Contribution per unitPrice minus variable cost
- 15
- Break-even revenue
- 8350.00
What this cannot tell you
- Pure arithmetic on the figures you enter. It assumes a single product at a constant price and cost.
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How this calculation works
Each unit earns its price minus its variable cost — that is its contribution margin. Dividing your fixed costs by that contribution gives the number of units that cover everything; multiplying those units by the price gives the sales revenue at the same point. Below that number you are running at a loss; above it, each further unit's whole contribution is profit. The maths assumes one product at a constant price and a constant per-unit cost.
What the results mean
- Contribution per unit
- Price minus variable cost — what each sale puts toward the fixed costs. If a £25 item costs £10 to make and ship, its contribution is £15.
- Break-even units
- How many you must sell before you are in profit. Rounded up, because a partial unit does not cover the gap.
- Break-even revenue
- The break-even units multiplied by the price — the total sales figure at which you neither make nor lose money. Handy when you think in revenue targets rather than unit counts.
Common problems and fixes
- A fixed cost and a variable cost look like they overlap
- Variable costs scale with each unit you make or sell — materials, packaging, shipping, per-sale fees. Fixed costs stay the same whatever the volume — rent, salaries, software, insurance. Putting a fixed cost in the per-unit box inflates the break-even point sharply, so split them by that test: does the cost change when you sell one more unit?
- The break-even number looks far too high
- Check that price and variable cost are per single unit, in the same currency, and that the price is the amount you actually keep. A thin contribution per unit — a high variable cost against a low price — is exactly what pushes break-even up, which is the real signal to act on.
Frequently asked questions
What if my price is below variable cost?
Then you lose money on every unit and never break even — the tool flags this rather than returning a negative or infinite figure. The fix is to raise the price above the variable cost so each sale contributes something toward fixed costs.
Does this include tax, or paying myself?
No — it works only on the figures you enter. If you want your own salary covered, add it to fixed costs. If your price includes sales tax or VAT that you have to remit, enter the net price you keep rather than the sticker price, or the contribution will be overstated.
What's the difference between break-even and profit?
Break-even is the point of zero profit — revenue exactly equals total cost. Every unit sold beyond break-even earns its full contribution as profit, because the fixed costs are already covered. That is why the units just past break-even are the most valuable ones you sell.
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