Find the units and revenue needed to break even.
Calculated locally in your browser.
How do you calculate the break-even point?
Break-even units = fixed costs ÷ (price − variable cost), and break-even revenue = units × price. For example, fixed costs of 1,000 with a 5 margin per unit break even at 200 units. The contribution margin (price − variable cost) must be positive, or you can never break even.
Understanding your result
The contribution margin (price − variable cost) must be positive, or you can never break even.
Formula and method
Break-even units = fixed costs ÷ (price − variable cost). Break-even revenue = units × price.
Assumptions and limitations
The model assumes a single price and constant variable cost per unit. Real businesses have tiered pricing, discounts and stepped fixed costs.
Worked example
Fixed costs of 1,000 with a 5 margin per unit break even at 200 units.
How it compares
| To lower the break-even point | Effect |
|---|---|
| Raise the price | Fewer units needed |
| Cut the variable cost | Fewer units needed |
| Reduce fixed costs | Fewer units needed |
How to use this tool
- Enter fixed costs.
- Enter price and variable cost per unit.
Common mistakes to avoid
- Setting variable cost above the selling price.
About the Break-Even Calculator
Find the sales volume at which total revenue equals total cost — your break-even point.
Who should use this tool
Founders, product managers and small-business owners pricing a product or planning a launch.
Benefits
- Know how many units you must sell to stop losing money.
- See the revenue target that covers all costs.
- Test how price or cost changes move the break-even point.
Practical use cases
- Pricing a new product before launch.
- Deciding whether a fixed-cost investment is worthwhile.
- Setting realistic monthly sales targets.
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Frequently asked questions
What if price equals variable cost?
Then each sale contributes nothing to fixed costs, so there is no break-even point.
What is the contribution margin and why does it matter?
The contribution margin is the price minus the variable cost per unit, the amount each sale contributes toward fixed costs. If it is zero or negative, no volume of sales can ever cover fixed costs, so the break-even point does not exist until pricing or costs change.
How do rising fixed costs change the break-even point?
Break-even units equal fixed costs divided by the contribution margin, so higher fixed costs raise the number of units needed to break even. You would need to sell more, raise the price, or cut variable costs to bring the break-even point back down.