Business
Break-Even Calculator
By the Dailycaltor team · formula-verified · last updated July 2026
How many sales until you stop losing money.
Details
Formula
Break-even units = fixed costs ÷ (price − variable cost per unit). The denominator is the contribution margin — what each sale contributes toward fixed costs.
Worked examples
- $5,000 fixed, $50 price, $30 variable → $20 contribution → 250 units to break even.
- Raising price to $55 cuts break-even to 200 units.
- Cutting fixed costs to $4,000 needs only 200 units at the original price.
Common mistakes
- Leaving costs out of “variable cost” — include materials, shipping, fees per sale.
- Treating your own time as free; salary belongs in fixed costs.
- Using yearly fixed costs against monthly sales (mismatched periods).
Last updated: July 2026. Educational estimates only.
Questions
What is the break-even point?
The sales volume where revenue equals total costs — zero profit, zero loss. Every unit beyond it is profit.
What is contribution margin?
Price minus variable cost per unit; the amount each sale contributes to fixed costs and then profit.
How do I lower my break-even?
Raise price, cut variable costs, or reduce fixed costs — each shrinks the units needed.
Does this work for services?
Yes — treat one “unit” as one client, project or billable hour.
What about a target profit?
Add the desired profit to fixed costs: (fixed + target) ÷ contribution = units required.
Monthly or yearly figures?
Either, as long as fixed costs and the resulting units use the same period.