Break-Even Calculator
Enter your total fixed costs, variable cost per unit, and selling price per unit to find the break-even point — the exact number of units you need to sell before your business starts making a profit. The calculator also shows the break-even revenue (units multiplied by price) and the contribution margin per unit.
Break-even analysis is one of the most fundamental tools in business planning. It tells you the minimum sales volume required to avoid a loss, helping you set realistic sales targets, evaluate pricing strategies, and assess the viability of a new product or venture.
The formula is straightforward: Break-Even Units = Fixed Costs / (Selling Price - Variable Cost per Unit). The denominator is your contribution margin — how much each unit sold contributes toward covering fixed costs.
By The Paper Room Editorial Team — Calculator Tools
Frequently asked questions
What are fixed costs vs variable costs?▼
Fixed costs stay the same regardless of how many units you produce — rent, salaries, insurance, and loan payments. Variable costs change with production volume — raw materials, packaging, shipping per unit, and sales commissions.
What is the contribution margin?▼
The contribution margin is the selling price minus the variable cost per unit. It represents how much each unit sold contributes toward covering your fixed costs. Once total contribution equals fixed costs, you have broken even.
What if the variable cost is higher than the price?▼
If the variable cost per unit exceeds the selling price, every unit sold loses money and no amount of volume will cover your fixed costs. You would need to either raise the price or reduce the variable cost to have a viable business model.