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Break-Even Point Calculator for Business: Units and Revenue

Enter fixed costs, price and variable cost per unit to see how many units, and how much revenue, you need to break even or reach a profit target.

Calculator

My fixed costs are
$

Costs that do not change with sales, such as rent, tools or setup.

$
$
$

Optional. Shows how long it takes or how safe you are.

Units to break even125≈ 125 units exactly
$2,500Revenue needed
$8.00Contribution / unit
40%Contribution margin

Margin of safety is how far sales can fall before you stop making a profit.

Amounts are in USD (United States selected). Change country or currency in the header. Exchange rates are approximate, from a static table updated 2026-10-25 — not live and not for transactions.

Estimates for planning only. Not tax or financial advice. Last verified: 2026-10-25

Break-even point calculator: how it works

Break-even is the sales volume at which total revenue equals total costs, so profit is zero. Costs split into fixed costs, which do not change with volume (rent, software subscriptions, salaries), and variable costs, which rise with each unit sold (materials, packaging, per-order fees).

Each unit contributes its price minus its variable cost toward covering the fixed costs. That amount is the contribution margin. Divide your fixed costs by the contribution per unit and you get the units required. Add a profit target to the fixed costs to see how many units you must sell to earn that profit. The result is rounded up because you cannot sell part of a unit.

Use it before launching a product, setting a price, signing a lease or hiring, to see how much you must sell before the decision starts paying for itself. Re-run it with a higher price or lower cost to see which lever moves break-even most.

Formula and assumptions

Formula

  • Contribution per unit = price − variable cost
  • Break-even units = (fixed costs + target profit) ÷ contribution per unit

Assumptions

  • Price and variable cost per unit are constant.
  • Fixed costs are for the same period as the target.

Worked example

A small product business

  1. Fixed costs 50,000 per month; price 500; variable cost 300.
  2. Contribution per unit = 500 − 300 = 200 (a 40% contribution margin).
  3. Break-even units = 50,000 ÷ 200 = 250 units, or 1,25,000 of revenue.
  4. To also earn 20,000 profit: (50,000 + 20,000) ÷ 200 = 350 units, or 1,75,000 of revenue.

Result: Sell 250 units to break even and 350 units to make 20,000 profit.

Limitations

  • Price and variable cost per unit are treated as constant, which ignores volume discounts and price changes.
  • It models one product. With several products you need an average contribution margin weighted by your sales mix.
  • Fixed costs are assumed not to step up as volume grows, though real businesses often need extra staff or space.
  • Break-even says nothing about how long it will take to reach that volume; check cash flow separately.

Frequently asked questions

What is contribution margin?

It is the price minus the variable cost per unit: the amount each sale contributes toward fixed costs and then toward profit.

What if the contribution is zero or negative?

You can never break even, because every extra unit loses money or adds nothing. Raise the price or lower the variable cost.

Should I use monthly or yearly fixed costs?

Either, as long as the target matches. Monthly fixed costs give monthly units; yearly fixed costs give yearly units.

How can I lower my break-even point?

Reduce fixed costs, raise the price, or cut variable costs. Each increases the contribution margin or shrinks the amount that must be recovered.

What is margin of safety?

It is how far your actual sales exceed break-even. If you sell 400 units against a break-even of 250, you can fall 37.5% before you start losing money.

How do I calculate the break-even point in units?

Divide fixed costs by the contribution margin per unit, which is price minus variable cost. With fixed costs of 50,000, a price of 500 and a variable cost of 300, each unit contributes 200, so you break even at 250 units. To reach a profit target of 20,000 as well, divide 70,000 by 200, which is 350 units.

How do I calculate break-even in dollars?

Multiply the break-even units by the selling price, or divide fixed costs by the contribution margin ratio, which is contribution per unit divided by price. In the example above, 250 units at 500 each is 125,000 of revenue. The same formula works in any currency.

Sources

Calculator data last verified: 2026-10-25. Estimates for planning only; not tax or financial advice.

What next?

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