Solverly

Break-Even Point Calculator

Know exactly when revenue covers every cost. The Break-Even Point Calculator shows the sales level where total contribution equals fixed overhead—no profit, no loss. It’s useful when pricing a new product, testing promotions, planning capacity, or deciding whether to launch, pause, or pivot.

This tool helps you translate costs and pricing into a clear sales target so you can set goals, prioritize efforts, and manage risk. The aim of break-even analysis is to turn uncertainty into a concrete threshold: how many units (or how much revenue) you need before every additional sale contributes to profit. Use it to align teams on targets, pressure-test scenarios, and make confident go/no-go decisions.

Enter your fixed and variable costs to see units, revenue, and total sales needed to break even—with live results and clear steps.

Enter your numbers

Quick breakdown

Contribution / unit
$12.50
Contribution margin
50.00%
Break-even units (exact)
400.0000
Break-even units (rounded)
400
Break-even revenue
$10000.00
Fees considered
0.00% + $0.00

Results interpretation

We show the exact break-even unit count and a rounded value. The rounded value is what we typically plan for, because we cannot sell a fraction of a unit. Break-even revenue uses the contribution margin ratio and is useful when goals are set in dollars rather than units.

  • Contribution per unit is the amount available to cover fixed costs after variable costs and fees.
  • Contribution margin contextualizes contribution relative to price and helps compare products.
  • Not feasible: if contribution per unit ≤ 0, no finite sales level covers fixed costs; adjust price or costs.

How it works

We model unit economics with a linear contribution approach. Fixed costs do not change with volume over the relevant range; variable costs and fees scale with units or revenue.

Formulas, assumptions, limitations

Contribution per unit: C = P − V − Fu − P×r.

Break-even units: QBE = F / C.

Contribution margin ratio: m = C / P; Break-even revenue: RBE = F / m.

Assumptions: price, unit cost, and fee rates are constant across the volume range; product mix and discounts are stable.

Limitations: step-fixed costs, tiered fees, and volume discounts are not modeled; treat them by scenario or adjust inputs.

Use cases & examples

E-commerce SKU

P $30 • V $14 • fee 6% + $0.30 • F $8,000 → C ≈ $13.50 → QBE ≈ 593 units.

Coffee cart

P $4.50 • V $1.10 • F $3,000 → C $3.40 → QBE ≈ 883 cups.

Digital license

P $99 • V $5 • F $25,000 → C $94 → QBE ≈ 266 licenses.

Break-even FAQs

What inputs matter most?

Price, variable costs, and fees drive contribution per unit; fixed cost sets the bar to cover.

Do we include labor?

Include direct labor in variable cost if it scales with units; include salaried staff in fixed cost.

How do discounts affect results?

Lower price reduces contribution and increases break-even. Test scenarios with likely discount levels.

Can we model bundles?

Use average price and blended variable cost for the bundle, or model each SKU separately and sum contribution.

What about returns or churn?

Adjust effective price or include an allowance in variable cost to reflect expected returns or churn.

Are step-fixed costs supported?

Not directly. Run multiple scenarios with the appropriate fixed cost for each volume range.

What margin is healthy?

It varies by category. Higher contribution margins provide more resilience to discounts and cost drift.

Should we round units?

Plan with the rounded-up value; it guarantees coverage of fixed cost.

Break-Even Analysis: Turning Unit Economics into Decisions

We use break-even analysis to separate signals from noise in pricing and cost conversations. By focusing on contribution per unit and the volume required to cover fixed cost, we can evaluate promotions, fee changes, and cost drift with clear expectations.

Why contribution drives everything

Contribution per unit is the engine of the model. It captures how much cash each sale contributes toward fixed costs before any profit appears. When contribution rises—through pricing power, lower unit cost, or lower fees—break-even units fall. When contribution falls, break-even units climb, sometimes sharply.

Reading margin the right way

Margin is often quoted as a percentage, but for planning we combine percentage and dollars. The percent tells us efficiency; the dollars tell us speed to cover fixed costs. A 40% margin at a $10 price contributes $4 per unit; the same percent at a $100 price contributes $40 per unit—ten times faster to break even.

Channel fees and payment costs

Marketplaces, app stores, and payment processors often charge both a percent of revenue and a per-transaction fee. These costs reduce contribution just like variable costs. When fee structures change, we can translate new terms into an equivalent percent and per-unit amount and update our model instantly.

Discounts, promotions, and coupons

Discounts reduce price and therefore contribution. Short promotional windows can still make sense if they create downstream value—new customers, higher lifetime value, or inventory clearance. The model shows how much extra volume is needed to earn back the discount.

Volume steps and capacity

Real operations sometimes add fixed cost in steps (a new shift or machine). We treat these as multiple scenarios: compute break-even with the current fixed cost, then recompute at the next step. If step-fixed cost comes with lower unit cost, test both effects together.

Scenario planning and sensitivity

A small change in price or variable cost can move break-even a lot, especially when contribution is thin. We explore +/- 5–10% scenarios for price and variable cost to see the range of likely outcomes and to pick guardrails for discounts and vendor negotiations.

From analysis to action

The numbers guide practical decisions: set a minimum price by ensuring contribution per unit clears a target; justify fixed-cost investments by stress-testing expected volume; and choose channels whose fee structure preserves healthy contribution.

Common pitfalls

  • Confusing markup with margin and overestimating contribution.
  • Ignoring per-unit fees when they are small; they add up at scale.
  • Assuming fixed costs never change—watch for step-changes as you grow.
  • Using average cost when product mix shifts the true variable cost.

Putting it all together

Break-even is not just a single number. It’s a compact way to talk about price, cost, and volume with the same language. With contribution at the center, we can design prices that work, choose channels that fit, and plan volumes that actually cover the bills.