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Enter your fixed costs and per-unit numbers to find your break-even point.
Your break-even point is the number of units you need to sell, or the revenue you need to bring in, before total income exactly covers total costs. Below it you're losing money; above it, every extra sale adds profit. It's one of the first numbers to check when pricing a product, planning a side hustle or deciding whether a new idea is worth it.
First work out the contribution margin, which is how much each sale contributes toward fixed costs:
Contribution margin = price per unit − variable cost per unit
Then:
Fixed costs stay the same however much you sell, such as rent, software subscriptions, insurance and equipment. Variable costs rise with each unit, such as materials, packaging, shipping and payment fees.
You sell candles for $40. Each one costs $25 in wax, jar, wick and postage, and your monthly fixed costs are $12,000:
Raising the price to $45 lifts the margin to $20 and drops break-even to 600 units. Small pricing changes have a big effect.
Add the profit you want to your fixed costs: units needed = (fixed costs + target profit) ÷ contribution margin. For $3,000 profit in the example above, that's (12,000 + 3,000) ÷ 15 = 1,000 units.
The contribution margin is negative, so every sale loses money and there is no break-even point. Raise the price or cut per-unit costs first.
How far your expected sales are above break-even: (expected sales − break-even sales) ÷ expected sales. A bigger margin means a sales dip is less likely to push you into a loss.
Yes. Treat a billable hour, a booking or a project as the “unit”, and count the direct costs of delivering it as the variable cost.