Break-Even Calculator
Find the sales volume needed to cover all costs and start making profit.
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Frequently Asked Questions
What is a break-even analysis?
Break-even analysis identifies the sales volume at which total revenue equals total costs — the point of zero profit or loss. Break-even units = Fixed Costs ÷ (Price − Variable Cost Per Unit). Understanding your break-even point is essential for pricing decisions, budgeting and assessing business viability.
What is contribution margin?
Contribution margin = Selling Price − Variable Cost Per Unit. It represents how much each unit sold contributes toward covering fixed costs and generating profit. A $50 product with $30 variable cost has a $20 contribution margin. You need to sell enough units to cover all fixed costs before making any profit.
How do I lower my break-even point?
Three levers: (1) Raise prices — increases contribution margin per unit, but risks lower sales volume. (2) Reduce variable costs — better supplier terms, process efficiency. (3) Reduce fixed costs — renegotiate rent, reduce headcount, eliminate non-essential expenses. Usually a combination delivers the best result.