Free Break-Even Calculator

What is a break-even point?

The break-even point is the number of units you need to sell before revenue covers all fixed and variable costs. Until you reach it, the business is operating at a loss on that product or service.

How this calculator works

1. Enter fixed costs: Add costs that stay the same regardless of volume, such as rent, salaries, or subscriptions.
2. Enter price per unit: This is what you charge for one unit of the product or service.
3. Enter variable cost per unit: Include costs that increase with each sale, such as materials, packaging, or payment fees.
4. Find contribution margin: Contribution margin is price per unit minus variable cost per unit. Each unit sold contributes this amount toward fixed costs.
5. Calculate break-even units: Divide fixed costs by contribution margin and round up to the next whole unit. Break-even revenue is break-even units multiplied by price.

Break-even formula

The denominator is contribution margin per unit. Rounding up ensures you cover fixed costs even when the division is not a whole number.

Worked example

Fixed costs are £12,000, you sell each unit for £80, and variable cost per unit is £35. Contribution margin is £45. Break-even units are ceil(£12,000 ÷ £45) = ceil(266.67) = 267 units. Break-even revenue is 267 × £80 = £21,360.

When to use this calculator

Use it when launching a product, testing a new price, or estimating how many sales you need before a project becomes profitable.