What is contribution margin?

Contribution margin = Selling Price - Variable Cost per Unit. It represents how much each unit sold contributes to covering fixed costs and then generating profit.

How do I reduce my break-even point?

Lower fixed costs, reduce variable costs per unit, increase selling price, or a combination of all three. Reducing variable costs is often the most impactful lever.

What if my variable cost exceeds the selling price?

If variable cost per unit is greater than or equal to the selling price, you lose money on every unit sold and can never break even regardless of volume. Repricing is essential.

Break-Even Calculator

The Break-Even Calculator tells you how many units you need to sell — and the revenue needed — to cover all your costs and start making a profit. The break-even point is a critical metric for any business: it shows exactly how much you need to sell before your business becomes profitable. Essential for startups, product launches, and pricing decisions.

Total Fixed Costs($)

Variable Cost per Unit($)

Selling Price per Unit($)

How to Use This Calculator

1
Enter total fixed costs (rent, salaries, insurance — costs that don't change with output).
2
Enter the variable cost per unit (materials, packaging, commissions).
3
Enter the selling price per unit.
4
Click Calculate to see the break-even point in units.

Frequently Asked Questions

The break-even point is the number of units sold at which total revenue equals total costs — producing neither profit nor loss. Formula: BEP = Fixed Costs ÷ (Selling Price - Variable Cost per Unit).

Related Calculators

🧮Payback Period Calculator 🧮ROI Calculator 🧮Profit Margin Calculator