Break-Even Calculator | Units & Target Profit

Quick Start Guide

  1. Enter Fixed Costs: Input your total fixed costs (rent, salaries, insurance, etc.).
  2. Enter Variable Cost Per Unit: Input the cost to produce or acquire one unit of product.
  3. Enter Price Per Unit: Input the selling price for one unit of your product.
  4. View Break-Even Units: See how many units you need to sell to cover all costs.
  5. View Break-Even Revenue: See the revenue amount needed to break even.
  6. Optionally Project Profit: Enter a planned sales volume to see projected profit and revenue at that volume.
  7. Set Target Profit: Switch to Target Profit mode to see how many units are needed to achieve a specific profit goal instead.

Understanding Break-Even Analysis

Contribution margin drives everything

Contribution margin (price minus variable cost per unit) is the amount each sale puts toward covering fixed costs. Once fixed costs are fully covered, every additional unit's contribution margin becomes pure profit — which is why the "Margin Ratio" shown in your results is the same contribution-margin-ratio metric used in cost-volume-profit analysis, not a separate calculation.

Simple vs. Target Profit

Simple mode answers "how many units to break even?" and optionally projects profit at a planned sales volume you enter. Target Profit mode answers a different question — "how many units to hit a specific profit goal?" — by solving the same cost structure for a non-zero profit target instead of zero.

Fixed and variable costs must be genuinely separated

This model assumes fixed costs stay constant and variable cost per unit stays constant across the volume range shown — real businesses often see step-changes in fixed costs (e.g. leasing a bigger space) or per-unit discounts at higher volumes that this simple linear model does not capture.

What this calculator does not cover

This models a single product or an averaged blend — it does not handle multi-product mix, taxes, or financing costs. For pricing decisions specifically (setting the price itself from a target markup or margin), see the Markup & Margin Calculator.

Features

Break-Even and Target Profit: Calculate units needed to cover costs or reach a profit goal.

Profit Projection: Optionally add a planned sales volume to see projected profit and revenue.

Contribution Margin: See how much each unit contributes to profit.

Interactive Chart: Visualize revenue, costs, and profit intersection.

Common Use Cases

Startup Planning: work out how many units a new business has to sell before it stops losing money, and how a change in fixed costs moves that date.

Product Launch: determine the viability of new products and see break-even units and revenue.

Pricing Strategy: set optimal prices for profitability and test different price and cost scenarios.

Sales Targets: set monthly or quarterly goals from break-even, using charts and export for planning.

Cost Reduction: analyze the impact of cost changes on break-even and see how lower fixed or variable costs reduce it.

Frequently Asked Questions

The break-even point is the sales volume where Total Revenue equals Total Costs (Fixed + Variable). At this point you cover all costs but make zero profit. Selling even one unit more generates profit.
Fixed costs (rent, salaries, insurance) do not change with production volume. Variable costs (materials, commissions) scale with each unit sold. This distinction is crucial for calculating contribution margin and understanding how profit grows with scale.
Contribution Margin = Selling Price - Variable Cost per Unit. It represents how much each sale contributes to covering fixed costs. Break-Even Units = Fixed Costs / Contribution Margin. A higher contribution margin means you reach break-even faster.
Target Profit Units = (Fixed Costs + Target Profit) / Contribution Margin. Use Target Profit mode in this calculator — enter your desired net profit and it solves for required units and revenue.

Related Calculators

ROI Calculator

Calculate return on investment for business decisions

Markup/Margin Calculator

Calculate markup and margin percentages

ROAS Calculator

Calculate return on ad spend for marketing

Loan Calculator

Calculate loan payments and interest.

Car Loan Calculator

Calculate car loan payments, total interest, and amortization schedule.

Mortgage Calculator

Estimate monthly mortgage payments.

Savings Calculator

Project your savings growth over time.

Investment Calculator

Project investment growth over time.

Retirement Calculator

Estimate your retirement savings.

Debt-to-Income Ratio Calculator

Calculate your debt-to-income ratio for loan eligibility.

Last updated