This free break even calculator shows you exactly how many units you need to sell, and how much revenue you need to earn, before your business starts making a profit. Enter your fixed costs, your price per unit, and your variable cost per unit to see your break-even point, your contribution margin, and the price that gets you to profit. Add an optional target profit to find the sales volume that hits your goal. No signup required.
Rent, salaries, software, insurance — costs that stay the same no matter how much you sell.
What you charge the customer for one unit or one sale.
Materials, packaging, shipping, and per-sale fees for one unit.
Profit you want on top of covering costs, per month.
Add your fixed costs and your price per unit to see how many units you need to sell to break even.
Auritrack tracks your fixed costs, variable costs, and sales in one place, so you always know how close you are to breaking even, without rebuilding a spreadsheet.
Try Auritrack FreeAdd up the costs that stay the same no matter how much you sell — rent, salaries, software subscriptions, and insurance. Enter that total and choose whether it is a monthly or one-off figure.
Type in what you charge the customer for one unit or one sale. This is the price before any discounts, taxes, or fees.
Add the costs that rise with each sale — materials, packaging, shipping, and per-transaction payment fees. This is what it costs you to deliver one unit.
If you want to know how many units it takes to reach a specific profit, not just cover costs, enter your target profit. Leave it blank to see the pure break-even point.
Instantly see how many units and how much revenue you need to break even, your contribution margin per unit, and how each sale splits between variable cost and margin.
The break-even point is the moment your total revenue exactly equals your total costs, so you make neither a profit nor a loss. Below it, you are losing money on the venture; above it, every additional sale drops profit into your pocket. It is one of the first numbers any founder, freelancer, or small business owner should know, because it turns a vague hope of “selling enough” into a concrete target. Instead of asking whether a product is viable, you can ask a sharper question: can you realistically sell the number of units the break-even point demands, at the price you have set, within your timeframe? If the answer is no, you know to change the price, the costs, or the plan before you spend a cent building it.
Every cost in your business falls into one of two buckets, and separating them correctly is the foundation of an accurate break-even calculation. Fixed costs stay the same no matter how much you sell. Rent, salaried staff, insurance, accounting software, and equipment leases all cost the same whether you sell one unit or ten thousand. They are the hurdle you have to clear every period just to keep the doors open.
Variable costs move with each sale. Raw materials, packaging, shipping, sales commissions, and the payment processing fee on every transaction all rise as your volume rises. If you sell nothing, you pay nothing in variable costs. The distinction matters because break-even analysis treats the two completely differently: fixed costs are the total you must cover, while variable costs are subtracted from each sale before anything is left over to chip away at that total. A common mistake is filing a genuinely variable cost, like per-order shipping, under fixed costs, which quietly inflates your break-even point and makes a healthy product look unviable.
Contribution margin is the engine of break-even analysis. It is what remains from a single sale after you subtract that unit’s variable cost, and it is the amount each sale “contributes” toward paying off your fixed costs. If you sell a product for $40 and it costs $24 in materials, packaging, and fees, your contribution margin is $16 per unit. Divide your fixed costs by that $16 and you have your break-even quantity. The margin can also be read as a percentage of price, which lets you compare products of very different price points on a level footing.
Break-even units = Fixed costs / (Price − Variable cost)
The denominator is your contribution margin per unit
A wide contribution margin means each sale does a lot of heavy lifting, so you break even on fewer units and reach profit faster. A thin margin means you need volume, which is why low-margin businesses live or die on scale. Understanding your margin is closely tied to your overall profitability, and our profit margin calculator helps you see how contribution margin at the unit level rolls up into the net margin of your whole business.
Once you know your break-even point, the natural next question is how to lower it, and you have exactly three levers to pull. The first is cutting fixed costs. Renegotiating rent, dropping software you no longer use, or delaying a hire all reduce the total you need to cover, which lowers your break-even directly and proportionally. The second is trimming variable cost per unit, whether by buying materials in bulk, reducing waste, or switching to a cheaper payment processor. Every dollar you shave off variable cost widens your contribution margin and pulls the break-even point down.
The third and often most powerful lever is price. Because a price increase lifts the contribution margin on every single unit, even a modest bump can slash the number of units you need to sell. If your product currently breaks even at 1,000 units, raising the price enough to widen the margin by 20% can drop that target closer to 830 units without touching your costs at all. When you send quotes and invoices, small pricing decisions compound quickly, and using an invoice generator to present clean, professional pricing makes it easier to charge what your work is worth rather than defaulting to the lowest number a client might accept.
Breaking even is the floor, not the goal. Once you know the point at which you stop losing money, you can layer a profit target on top and work out the sales volume that actually pays you. This calculator lets you enter a target profit and instantly shows the units and revenue required to reach it, so you can price and plan around the life you want the business to fund rather than mere survival. The logic is the same as the core formula, with your profit target simply added to your fixed costs before dividing by the contribution margin.
Pricing for profit also means thinking beyond a single product. If you are launching or expanding and need equipment, inventory, or premises up front, that financing carries a cost that has to be earned back through your margins. Before you commit, it is worth modelling the repayments with a business loan calculator so you can fold the true cost of borrowing into your break-even and confirm that the volume you need to sell is genuinely within reach. A price that only breaks even on paper, but ignores the loan you took to get started, is a price that quietly loses money. Get the contribution margin right, set a realistic profit target, and let the break-even point tell you whether the numbers actually work.
Find your gross and net profit margin, markup, and profit from cost and price, and see what a healthy margin looks like for your business.
Create professional invoices with auto-calculated line items and tax, then download a clean PDF. No signup, works in any currency.
Estimate your federal and state tax liability, see your effective tax rate, and use AI to find deductions you might be missing.
Run the Numbers
Auritrack tracks your fixed costs, variable costs, and sales in one place, so you always know how close you are to breaking even and turning a profit, without rebuilding a spreadsheet every month. Free to start.
Disclaimer: This tool is provided for informational and educational purposes only. It does not constitute financial, tax, investment, or legal advice. Results are estimates based on the inputs you provide and may not reflect actual financial outcomes. Always consult a qualified financial professional before making financial decisions.
