Break Even Calculator
Find the number of units a stall, a range or a workshop has to sell to cover its fixed costs, after fees.
Break even is the number of units that pays for everything and leaves nothing, and it is the most useful single number a small maker can know. This calculator works it out from the fixed costs of a selling period, the variable cost of one unit and the price you charge, with marketplace fees taken off the price rather than added to the cost. It reports the units, the revenue and what happens above and below that point.
At a glance
- What you enter
- Fixed costs for the period, Selling price per unit, Variable cost per unit, Selling fees, Fixed charge per transaction, Units you expect to sell, Profit you want to make, Target margin on the price
- What you get
- Contribution per unit, Contribution margin on the price, Break even units, Break even units, unrounded, Revenue at break even, Variable costs at break even, Fees at break even, Units to reach the target profit, Profit at the units you expect, Units of margin of safety, Margin of safety as a share of expected sales, The target margin is achievable, Price needed for the target margin, Target margin is arithmetically impossible, Price increase needed, Each sale contributes something, Loss at one unit below break even
- Formula shown
- Yes, every step, right below your results.
- Cost and privacy
- Free, no account needed, and nothing you type is stored.
See worked examples ↓ Read the FAQ ↓ Share this calculator ↓
Results are estimates for general information only, always verify with a professional or official source before acting on them.
How to use the Break Even Calculator
- 1 Enter Fixed costs for the period, Everything you pay whether you sell or not: stall fee, pitch, travel, parking, accommodation, licences.
- 2 Enter Selling price per unit
- 3 Enter Variable cost per unit, Material, labour, packaging and anything else that rises with each unit sold.
- 4 Enter Selling fees (%), Marketplace commission and payment processing, as a share of the selling price.
- 5 Enter Fixed charge per transaction, The flat part of a payment processing charge. It reduces the contribution of every sale.
- 6 Enter Units you expect to sell, Optional. Used for the margin of safety and the profit at that volume.
- 7 Enter Profit you want to make, Optional. The units needed to reach this profit rather than to break even.
- 8 Enter Target margin on the price (%), Optional. Used to check whether the price can carry this margin after the fees. If fees plus margin reach 100 percent the request is impossible.
- 9 Press Calculate. You get Contribution per unit, Contribution margin on the price, Break even units, Break even units, unrounded, Revenue at break even, Variable costs at break even, Fees at break even, Units to reach the target profit, Profit at the units you expect, Units of margin of safety, Margin of safety as a share of expected sales, The target margin is achievable, Price needed for the target margin, Target margin is arithmetically impossible, Price increase needed, Each sale contributes something, Loss at one unit below break even, and every intermediate step stays visible under "How is this calculated?"
- 10 Change one number at a time to see what moves the result, that is usually the most useful thing a calculator can tell you.
Worked examples
Real numbers run through this calculator. Open any example to load it into the form above and change it.
A craft fair stall
A 250 dollar stall with items at 28 dollars and a variable cost of 11.
You enter
- Fixed costs for the period
- $250.00
- Selling price per unit
- $28.00
- Variable cost per unit
- $11.00
- Selling fees
- 0%
- Fixed charge per transaction
- $0.00
- Units you expect to sell
- 25
- Profit you want to make
- $300.00
- Target margin on the price
- 0%
You get
- Contribution per unit
- $17.00
- Contribution margin on the price
- 60.7%
- Break even units
- 15
- Break even units, unrounded
- 14.71
- Revenue at break even
- $420.00
- Variable costs at break even
- $165.00
- Fees at break even
- $0.00
- Units to reach the target profit
- 33
- Profit at the units you expect
- $175.00
- Units of margin of safety
- 10
- Margin of safety as a share of expected sales
- 40.0%
- The target margin is achievable
- 1
- Price needed for the target margin
- $11.00
- Target margin is arithmetically impossible
- 0
- Price increase needed
- $0.00
- Each sale contributes something
- 1
- Loss at one unit below break even
- $-12.00
A contribution of 17.00, so fifteen units to break even and 33 units to make 300 dollars of profit. At 25 units the profit is 175 dollars.
The same stall on a card machine
A 3 percent processing fee plus 30 cents a transaction.
You enter
- Fixed costs for the period
- $250.00
- Selling price per unit
- $28.00
- Variable cost per unit
- $11.00
- Selling fees
- 3%
- Fixed charge per transaction
- $0.30
- Units you expect to sell
- 25
- Profit you want to make
- $300.00
- Target margin on the price
- 0%
You get
- Contribution per unit
- $15.86
- Contribution margin on the price
- 56.6%
- Break even units
- 16
- Break even units, unrounded
- 15.76
- Revenue at break even
- $448.00
- Variable costs at break even
- $176.00
- Fees at break even
- $18.24
- Units to reach the target profit
- 35
- Profit at the units you expect
- $146.50
- Units of margin of safety
- 9
- Margin of safety as a share of expected sales
- 36.0%
- The target margin is achievable
- 1
- Price needed for the target margin
- $11.65
- Target margin is arithmetically impossible
- 0
- Price increase needed
- $0.00
- Each sale contributes something
- 1
- Loss at one unit below break even
- $-12.10
The contribution falls to 15.86 and break even rises to sixteen units. Small, but it is real money on every sale.
An impossible margin request
A 30 percent commission and a 20 percent processing fee with a 60 percent target margin.
You enter
- Fixed costs for the period
- $250.00
- Selling price per unit
- $28.00
- Variable cost per unit
- $11.00
- Selling fees
- 50%
- Fixed charge per transaction
- $0.30
- Units you expect to sell
- 25
- Profit you want to make
- $300.00
- Target margin on the price
- 60%
You get
- Contribution per unit
- $2.70
- Contribution margin on the price
- 9.6%
- Break even units
- 93
- Break even units, unrounded
- 92.59
- Revenue at break even
- $2,604.00
- Variable costs at break even
- $1,023.00
- Fees at break even
- $1,329.90
- Units to reach the target profit
- 204
- Profit at the units you expect
- $-182.50
- Units of margin of safety
- -68
- Margin of safety as a share of expected sales
- -272.0%
- The target margin is achievable
- 0
- Price needed for the target margin
- $0.00
- Target margin is arithmetically impossible
- 1
- Price increase needed
- $0.00
- Each sale contributes something
- 1
- Loss at one unit below break even
- $-1.60
The fees and the margin together reach 110 percent, so the tool reports the request as impossible rather than returning a negative price.
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Frequently asked questions
How do I calculate my break even point?
Divide the fixed costs by the contribution per unit, where the contribution is the selling price minus the variable cost and minus any fee that comes off the price. A stall costing 250 dollars with a 28 dollar item that costs 11 dollars and carries no fees has a contribution of 17 dollars, so break even is fifteen units, rounded up from 14.7. After the fifteenth sale, everything is profit minus the variable cost of each further unit.
Why do fees change the break even point?
Because a percentage fee comes off the selling price, so it reduces what each sale contributes rather than adding to what you spend. A fifteen percent commission on a 28 dollar item is 4.20, which drops the contribution from 17 to 12.80 and raises the break even from fifteen units to twenty. Fees are the reason an item that breaks even on a market stall may not break even online at the same price.
What is a good margin of safety?
A break even below about two thirds of the volume you realistically expect is a reasonable target, which is a margin of safety of about thirty percent. Below twenty five percent there is very little room for a wet weekend or a slow month. If the break even is close to the expected volume, the plan depends on the optimistic case happening, which is not a plan.
What if the break even needs more units than I can possibly sell?
Then the price is too low, the variable cost is too high or the fixed costs are too large for the market. Raising the price is the fastest lever because the whole increase goes to the contribution, but the market has to accept it. Reducing the variable cost means a cheaper material, a simpler product or a faster process. Reducing the fixed costs means a cheaper stall or a smaller range. If none of the three can move, the venture does not work.
Is break even the same as profit?
No. Break even is where the revenue covers the fixed costs and the variable costs and leaves nothing at all. Every unit past that point adds its whole contribution to profit. At one unit below break even you are still making a real loss, which this calculator shows explicitly. A business that breaks even is surviving rather than succeeding, and the target profit figure is the more useful number.
Terms used here
Short, plain-language definitions of the words this calculator uses.
Break-even point
The point at which revenue covers costs and profit is zero.
Marketplace fee
The commission an online marketplace takes from each sale, usually a percentage of the total including shipping, plus a separate payment processing fee and sometimes a fixed...
Overhead
The costs of running a business that do not belong to any one product: studio rent, utilities, insurance, software subscriptions, tools, marketing and your own time on...