Find out exactly when your business starts making a profit.
Lines cross at the break even point (200 units)
Every business needs to know its break even point, the exact moment when revenue equals costs and you stop losing money. This break even calculator makes it simple. Enter your monthly fixed costs such as rent, salaries, insurance, and software subscriptions. Add the variable cost you pay for each unit you sell, like materials, packaging, and shipping. Then set your selling price. The calculator instantly shows how many units you must sell and how much revenue you need to cover all your costs.
The contribution margin is the difference between your selling price and your variable cost per unit. It tells you how much each sale contributes toward covering your fixed costs. A higher contribution margin means you reach profitability faster. The contribution margin ratio, expressed as a percentage, shows what fraction of every revenue dollar goes toward covering fixed costs and generating profit. Use these numbers to evaluate pricing strategies and compare products.
The visual chart above shows exactly where your revenue line crosses your total cost line. Every unit sold beyond the break even point is pure profit, less variable costs. Use this tool when launching a new product, adjusting prices, planning a promotion, or evaluating whether to take on additional fixed costs like hiring or renting a larger space. Adjust the inputs and watch the break even point shift in real time.
Want to understand your profit margins? Try our profit margin calculator. Need to figure out the right markup? Use the markup calculator.