Break-Even Point Calculator
Find how many units you must sell, and how much revenue you need, to cover your costs and start making a profit
Last updated: November 2, 2026
How to Use the Break-Even Point Calculator
How to calculate your break-even point
- Enter your fixed costs. Add up the costs you pay regardless of sales, for the period you are looking at (usually a month or a year).
- Enter the selling price per unit. This is what one customer pays for one item or service.
- Enter the variable cost per unit. Include materials, packaging, shipping and payment fees for one unit.
- Add a profit target (optional). Enter how much profit you want, and the calculator shows the sales needed to reach it.
- Read the results. You will see the units and revenue needed to break even, your contribution margin per unit and as a percentage of price.
Use the same time period for fixed costs and for the number of units. A monthly fixed cost gives you monthly break-even units.
Formula & Methodology
Break-even formulas
Contribution margin per unit = Selling price − Variable cost per unit
Break-even units = Fixed costs ÷ Contribution margin per unit
Break-even revenue = Break-even units × Selling price
You can also work in revenue directly: Break-even revenue = Fixed costs ÷ Contribution margin ratio, where the ratio is the contribution margin divided by the selling price.
Worked example
A business has $10,000 of fixed costs a month. It sells a product for $50 with a variable cost of $30 per unit.
- Contribution margin = 50 − 30 = $20 per unit
- Break-even units = 10,000 ÷ 20 = 500 units
- Break-even revenue = 500 × 50 = $25,000
- Contribution margin ratio = 20 ÷ 50 = 40%, and 10,000 ÷ 0.40 = $25,000 gives the same answer
Reaching a profit target
To earn a profit, add it to the fixed costs you need to cover:
Units for a target = (Fixed costs + Target profit) ÷ Contribution margin
With a $5,000 profit goal: (10,000 + 5,000) ÷ 20 = 750 units.
Why it matters
Below the break-even point you lose money, above it every extra unit adds its contribution margin to your profit. A higher price, lower variable costs or lower fixed costs all push the break-even point down.
About Break-Even Point Calculator
Our break-even point calculator is a free, easy-to-use tool designed to help you find how many units you must sell, and how much revenue you need, to cover your costs and start making a profit. For professionals or those who need quick calculations, our calculator provides accurate results instantly.
Frequently Asked Questions
What is the break-even point?
It is the amount of sales at which total revenue equals total costs, so you make neither a profit nor a loss. Selling any more than this number of units makes a profit; selling fewer makes a loss.
How do you calculate the break-even point in units?
Divide your fixed costs by the contribution margin per unit (the selling price minus the variable cost per unit). With $10,000 of fixed costs, a $50 price and $30 variable cost, you need 10,000 ÷ 20 = 500 units.
What is the difference between fixed and variable costs?
Fixed costs do not change with the number of units you sell, such as rent, salaries and insurance. Variable costs rise with every sale, such as materials, packaging and shipping. Some costs are mixed, so split them into the two parts as best you can.
What is contribution margin?
It is what each sale contributes towards paying off your fixed costs and then profit: the selling price minus the variable cost per unit. It is often shown as a percentage of the price, the contribution margin ratio.
How can I lower my break-even point?
Raise your price, reduce your variable cost per unit, or cut your fixed costs. Each of these either increases the contribution per sale or reduces the amount you need to cover.
Why does the calculator say I can never break even?
If your variable cost per unit is equal to or higher than your selling price, each sale loses money, so selling more only increases the loss. You need to increase the price or reduce the variable cost before a break-even point exists.
Does the break-even point include taxes or multiple products?
No. This calculator assumes one product at one price and ignores taxes. For several products, use an average price and average variable cost based on your usual sales mix.
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