Break Even Calculator

What is break even calculator?

The break even point is where your income equals your total costs, so you make neither profit nor loss. Every unit after that adds profit.

This calculator uses the contribution margin method. It is useful for shops, online sellers, freelancers and anyone pricing a product or service.

How to use the break even calculator

1. Enter your fixed costs for the period.
2. Enter the selling price and the variable cost of one unit.
3. Read the break even units and sales.

How the break even calculator works

Contribution per unit equals price minus variable cost. Break even units equal fixed costs divided by contribution per unit, rounded up. Break even sales equal units times price.

Worked example

Common uses of the break even calculator

• Pricing a new product.
• Planning a shop or a stall.
• Checking a freelance rate.
• Testing a business idea.
• Reviewing a discount.

Tips and common mistakes

Include every fixed cost: rent, salaries, software and loan payments.

If break even is too high, raise the price, cut costs or both.

Background: what to know before you rely on it

Break even analysis tells you the minimum you must sell to survive. It also shows how sensitive your plan is: a small price change can move break even by a large amount. If the contribution margin is thin, a small drop in volume can mean a loss. Many new businesses fail by underestimating fixed costs or overestimating sales. Run the numbers with pessimistic assumptions, and then see if the plan still works.

Private, free and fast

This tool runs entirely in your browser. What you type or choose is not uploaded to a server and is not saved after you close the page, which keeps it fast and private. It is free to use as often as you like. See more in all finance calculators, or browse the full list of tools.

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Results are for information and education. For legal, financial, medical or security decisions, check with a qualified professional. Estimates only. Confirm with your lender or accountant.