Break-Even Calculator

Most break-even calculators hand you a single number and stop there. This one gives you the chart behind that number. Type your fixed costs, your price, and what each unit costs you to make, and you get the classic break-even chart: a revenue line climbing from zero, a total-cost line starting up at your fixed costs, and the exact spot where they cross. Left of that crossing you're losing money, shaded red, and to the right you're in profit, shaded green. Seeing the two lines meet makes break-even easier to grasp than a single figure does.

The numbers ride along with it. Fixed costs of $10,000, a $50 price, and $30 of variable cost per unit? You break even at 500 units and $25,000 in revenue, with a $20 contribution margin on every sale. Type in what you expect to sell and the chart marks your spot and reports the margin of safety. Flip to the second mode for the question every owner really has: how many do I need to sell to clear a real profit, not just cover costs. It all runs in your browser, nothing you enter leaves your device, and it redraws the instant you change a number.

Break-even is the sales level where total revenue exactly equals total costs, so you make neither profit nor loss. It's the line you cross before a single dollar of profit shows up, worth pinning down before you launch a product, sign a lease, or greenlight a discount.

1. Pick a mode. Break-even point gives you the units and revenue that cover your costs. Units for a target profit takes a profit you want and tells you the volume to reach it.
2. Enter your fixed costs. The expenses that don't move with sales, rent, salaries, insurance, software, loan payments. Total them for the period you're planning.
3. Enter your price per unit. What a customer pays for one unit of the thing you sell.
4. Enter your variable cost per unit. What one unit actually costs you: materials, the wholesale price, packaging, postage, the card-processing fee, any commission. Anything that only exists because you made or sold that unit.
5. Add the optional extra. In break-even mode, drop in your expected sales to see the margin of safety and your spot on the chart. In target mode, type the profit you want to clear.
6. Read the results and watch the chart. Contribution margin, break-even units and revenue, and the crossing point all update live, so you can test a price bump or a cost cut in seconds.

Leave a box empty and you get a dash and a short prompt, never a scary error code. Price a unit at or below its variable cost and the tool tells you plainly there's no break-even, instead of drawing nonsense.

The chart is three lines and a crossing. The revenue line starts at zero and climbs by your price with every unit. The total-cost line starts partway up the axis, at your fixed costs, because those bills are due even if you sell nothing, and it climbs more gently, by your variable cost per unit. A dashed fixed-cost line sits flat to show that floor.

Because revenue climbs faster than cost, the two lines have to meet. That meeting is your break-even, and the tool marks it with a dot and drops a guide to the exact unit count. Everything to the left, where cost sits above revenue, is the loss zone in red. Everything to the right, where revenue pulls ahead, is profit in green. Hover anywhere and it reads out the revenue, the total cost, and the profit or loss at that exact volume. Seeing it plotted this way makes the formula concrete instead of abstract.

Sort your costs into fixed and variable first, because everything downstream depends on that split, and it's where most people slip. A salaried designer counts as fixed, while a freelancer you pay per project drifts toward variable. When a cost is genuinely mixed, split it, base into fixed and the per-unit slice into variable. Guess wrong here and your break-even lands confidently in the wrong place.

Once costs are sorted, one figure does the real work: the contribution margin per unit.

contribution margin = price per unit minus variable cost per unit

That's the money left from each sale after you've paid the variable cost of that one unit, the amount that "contributes" toward covering fixed costs. In the example, $50 minus $30 is $20. Every unit hands you $20 to throw at the rent. Once the rent and every other fixed cost is paid off, that same $20 stops covering costs and becomes straight profit. As a share of the price it's the contribution margin ratio, $20 out of $50, so 40%, which is handy when you sell a mix of products and want one blended number.

This is the number most free calculators skip, and it is the one that actually tells you how much danger you are in. Add your expected sales and the tool works out the margin of safety, the gap between what you expect to sell and your break-even point.

Break even at 500 units and expect 800? Your margin of safety is 300 units, about 37.5%. Sales could fall by that much before you'd start losing money. A fat cushion means you can ride out a slow month, a lost client, a seasonal dip. A thin one, break even at 500 and expect 520, means you're one bad week from red ink. Two businesses can both be profitable while being in wildly different amounts of danger, and the margin of safety is what tells them apart.

The point itself is never fixed, either. Raising the price lowers it, and taking on another fixed cost pushes it back up. Discounts are the trap most people underrate: knock 20% off a $50 price and the margin falls from $20 to $10, so break-even doubles from 500 units to 1,000. Run the new break-even before you sign off on any discount.

One honest caveat. This is a straight-line model, so it assumes fixed costs never jump and every unit carries the same variable cost. Real costs often step up in chunks and vary from one unit to the next. Treat the result as a sharp estimate, not a promise, and for a wide product mix or big step costs, back it with a fuller model. The U.S. Small Business Administration keeps free guidance on this at sba.gov.