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Break-even calculator

Fixed costs, price and variable cost in. The units and revenue you need to stop losing money out.

Rent, software, salaries. Anything you pay whether or not you sell.

Product, packaging, shipping, payment fees, ad cost per order.

Break-even units per month80
Break-even revenue per month$3,200.00
Contribution margin per unit$25.00
Contribution margin62.5%
Units per day (÷ 30)2.7

Past 80 units every sale adds $25.00 of profit.

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1

Enter your fixed costs

Rent, software, salaries, anything you pay regardless of sales volume, for the period you're measuring.

2

Enter price and variable cost per unit

What you sell one unit for, and what it costs you to make or source and ship it.

3

Read your break-even point

The units and revenue you need before the next sale is pure profit.

The break-even formula

Break-even units = fixed costs ÷ (price − variable cost per unit). The denominator is your contribution margin per unit, what's left from each sale after the costs that scale with it. Example: $2,000 in monthly fixed costs, a $40 product with $15 in variable cost per unit, contribution margin is $25, so break-even units = 2,000 ÷ 25 = 80 units a month.

Break-even revenue = break-even units × price. In the example, 80 units × $40 = $3,200 a month in sales just to cover fixed costs, before a dollar of it is profit.

Why contribution margin matters more than price

Two products at the same price can have very different break-even points if their variable costs differ. Raising price or cutting variable cost both raise contribution margin and lower the number of units you need to sell.

A small cut in shipping or packaging cost per unit often moves the break-even point more than it looks like it should, because it compounds across every unit sold, not just the marginal one.

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Frequently asked questions

What is the break-even point?
The sales volume, in units or revenue, at which total revenue equals total costs. Below it you're losing money, above it every extra sale is profit.
What is the break-even formula?
Break-even units = fixed costs ÷ (price − variable cost per unit). Multiply by price to get break-even revenue.
What counts as a fixed cost?
Costs that don't change with sales volume: rent, salaries, software subscriptions, insurance. Measure them over the same period you're calculating break-even for, usually a month.
What counts as a variable cost?
Costs that scale with each unit sold: product cost, packaging, per-order shipping, payment processing fees, and the ad spend attributable to that sale.
What is contribution margin?
Price minus variable cost per unit, the amount each sale contributes toward covering fixed costs before it becomes profit.
How do I lower my break-even point?
Raise price, lower variable cost per unit, or cut fixed costs. Any of the three shrinks the number of units you need to sell to stop losing money.
Does break-even include ad spend?
Only if you count it as a variable cost per unit, which is the more accurate way to model an ecommerce business where most costs scale with orders rather than staying fixed.
Is a lower break-even point always better?
Generally yes, it means less risk and a shorter runway to profitability, but it can also mean you're underpricing. Check the resulting margin with the profit margin calculator too.

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