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Break-even Calculator

Calculate the number of units you need to sell to cover all your costs.

Calculator

Expenses that don't change with sales (rent, salaries, software).
$
The amount you charge for a single unit of your product.
$
The cost to produce or deliver a single unit.
$
UNITS TO BREAK EVEN
125units
Moderate

Standard range for many small-to-mid sized businesses.

Formula

Units = Fixed Costs ÷ (Price - Variable Cost)

Worked example

Units = $2,000 ÷ ($100 - $50) = 40 units.

Total Fixed Costs
2000
Price Per Unit
100
Variable Cost Per Unit
50

Industry benchmarks

High Target

Significant volume required to reach profitability.

Moderate

Standard range for many small-to-mid sized businesses.

Low Target

Efficient model. Profitability is reachable with relatively low sales volume.

FAQ & key takeaways

How to read this metric

What it measures

The Break-even Calculator determines the point at which your total revenue exactly equals your total expenses (both fixed and variable). At this point, your business makes zero profit but incurs zero loss.

Why it matters

Knowing your break-even point is essential for setting sales targets, determining product pricing, and evaluating the feasibility of a new business or product launch. It provides a concrete goal for your marketing and sales teams to reach to ensure sustainability.

How to lower your break-even point

  1. Reduce Fixed Costs: Lower your rent, renegotiate software contracts, or streamline operations.
  2. Increase Price: By charging more per unit, you increase the contribution margin of each sale, requiring fewer sales to cover costs.
  3. Lower Variable Costs: Find cheaper suppliers or more efficient manufacturing processes to increase the profit per unit.
  4. Improve Product Mix: Focus on selling items with higher contribution margins.