Easily determine your break-even point with our Break-even Calculator. Enter your fixed and variable costs, and sales price to find out how many units you need to sell to cover expenses. Includes a visual analysis chart to help you understand profit margins, cost behavior, and revenue trends at a glance. Perfect for business planning and financial forecasting.
Advanced Break-Even Calculator
Comprehensive business analysis tool with interactive charts, sensitivity analysis, and scenario planning
Business Parameters Input
Enter your business costs and pricing information
Rent, salaries, insurance, etc.
Materials, labor, shipping per unit
Revenue per unit sold
For profit analysis
Desired profit amount
Select your currency
Analysis time frame
Break-Even Analysis Results
Complete financial analysis and projections
Break-Even Units
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Units to break even
Break-Even Revenue
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Revenue to break even
Contribution Margin
–
Per unit profit
Margin Ratio
–
Contribution %
Break-Even Chart
Cost Breakdown
Profit Analysis
Sensitivity Analysis
Price Sensitivity
| Price Change | New Price | Break-Even Units |
|---|
Cost Sensitivity
| Cost Change | New Fixed Cost | Break-Even Units |
|---|
Scenario Planning
Pessimistic Scenario
Base Scenario
Optimistic Scenario
Break-Even Analysis Theory
Understanding the fundamentals of break-even analysis
What is Break-Even Analysis?
Break-even analysis is a financial calculation that determines the point at which total revenues equal total costs, resulting in neither profit nor loss. This critical business tool helps entrepreneurs and managers understand the minimum performance required to avoid losing money.
At the break-even point, your business covers all its fixed and variable costs but hasn’t yet started generating profit. Any sales beyond this point contribute directly to profit.
Key Components:
- Fixed Costs: Expenses that remain constant regardless of production volume (rent, salaries, insurance)
- Variable Costs: Expenses that change with production volume (materials, labor, shipping)
- Selling Price: Revenue generated per unit sold
- Contribution Margin: Selling price minus variable cost per unit
Key Formulas
Break-Even Point (Units)
BEP = Fixed Costs ÷ (Selling Price – Variable Cost)
Break-Even Point (Revenue)
BEP Revenue = BEP Units × Selling Price
Contribution Margin Ratio
CM Ratio = (Selling Price – Variable Cost) ÷ Selling Price
Units for Target Profit
Units = (Fixed Costs + Target Profit) ÷ Contribution Margin
Business Applications
Startup Planning
Determine minimum sales targets and assess business viability before launching new products or services.
Pricing Strategy
Set optimal prices by understanding how price changes affect break-even requirements and profitability.
Performance Monitoring
Track business performance against break-even targets and identify areas for cost optimization.
Step-by-Step Calculation Guide
Identify Fixed Costs
List all expenses that remain constant regardless of sales volume (rent, insurance, base salaries).
Calculate Variable Cost per Unit
Determine costs that vary with each unit produced (materials, labor, shipping).
Set Selling Price
Establish the price at which you’ll sell each unit to customers.
Calculate Contribution Margin
Subtract variable cost per unit from selling price per unit.
Compute Break-Even Point
Divide total fixed costs by contribution margin per unit to get break-even units.
Tips & Best Practices
Do’s
- Regularly update your break-even analysis as costs and prices change
- Consider multiple scenarios (best case, worst case, most likely)
- Use break-even analysis for pricing decisions and cost control
- Include all relevant costs in your analysis
Don’ts
- Don’t ignore the time value of money for long-term analysis
- Don’t assume linear relationships for all cost structures
- Don’t rely solely on break-even analysis for business decisions
- Don’t forget to consider market demand constraints
Break-even Calculator FAQ
What is a Break-even Calculator?
A Break-even Calculator helps you determine the number of units or the amount of sales needed to cover your fixed and variable costs, showing when your business starts making a profit.
What is shown in the analysis chart of Break-even Calculator?
The analysis chart visually represents your costs, revenue, and profit/loss zones. It helps you understand the break-even point and how sales impact profitability.