Break-Even Calculator
Work out how many units you need to sell — and how much revenue that represents — before your business turns a profit.
How is this calculated?
Contribution margin per unit = selling price − variable cost. Units to break even = fixed costs ÷ contribution margin. Revenue at break-even = units × selling price. If contribution margin is zero or negative, the business loses money on every sale and can never break even at those numbers.
Frequently Asked Questions
What is the break-even point?
The break-even point is where total revenue equals total cost — no profit, no loss. Below it, you're losing money on the period as a whole. Above it, every additional unit generates the contribution margin as profit.
What counts as a fixed cost?
Fixed costs don't change with sales volume in the short run: rent, salaries, insurance, software subscriptions, business rates, accountant fees. Variable costs scale with each unit sold: materials, packaging, payment processing, per-unit shipping.
How do I lower my break-even point?
Three levers: cut fixed costs (renegotiate rent, reduce overheads); raise selling price (test with customers); reduce variable cost per unit (better suppliers, batch buying, process improvement). The biggest gains usually come from raising prices, not cutting cost.
Is break-even the same as profitability?
No. Break-even is the threshold below which you lose money. Profitability requires sustained operation above break-even, accounting for tax (corporation tax in Ireland is 12.5% on trading profits) and reinvestment. A single break-even month is just the floor — long-term profit needs consistently exceeding it.
Can a service business calculate break-even?
Yes — treat each billable hour or engagement as a 'unit'. Variable cost is the direct cost of delivering one engagement (contractor pay, project tools); fixed cost is everything else. Then compute units (hours / engagements) needed per month or year.
Last updated: May 2026 · Rates sourced from Revenue