Break-Even Calculator

How to use the Break-Even Calculator

1. Enter your total fixed costs: expenses like rent, salaries, and insurance that stay the same regardless of sales volume.
2. Enter the variable cost per unit: materials, packaging, shipping, and other costs that change with each unit produced.
3. Enter your selling price per unit.
4. Review the break-even point and the chart to see where your revenue line crosses your total cost line.
5. Experiment with different prices or cost structures to find the most profitable scenario.

Why break-even shifts more than people expect from a small price change

Because fixed costs stay constant regardless of volume, a small change in your per-unit price or variable cost has an outsized effect on your break-even point. A 10% price increase on a product with thin margins can meaningfully lower the number of units you need to sell to cover fixed costs, since that "extra" 10% margin per unit chips away at fixed costs faster with every additional sale. This is why pricing strategy is so often more impactful for early-stage break-even math than trying to cut costs, which tends to have a smaller and slower effect on the same number.

Frequently asked questions

What counts as a fixed cost vs. a variable cost?

Fixed costs stay the same regardless of how much you sell (rent, salaries, insurance); variable costs scale with volume (materials, packaging, per-unit shipping). The split matters because only the margin per unit (price minus variable cost) contributes to covering fixed costs.

What if my costs don't fit neatly into "fixed" and "variable"?

Many real costs are semi-variable (a phone plan with a base fee plus usage charges, for example). For a rough break-even estimate, categorize each cost by whichever behavior dominates rather than trying to split every cost precisely.

Does break-even account for taxes?

No. This calculates the point where revenue equals costs before tax; actual after-tax profitability requires a separate calculation on top of the break-even figure.