Break-Even Calculator
How many units you must sell to cover your costs — with a chart.
Break-even chart
- Revenue
- Total cost
- Fixed costs
Profit at different sales volumes
| Sales | Units | Revenue | Total cost | Profit |
|---|
Results are estimates for general information and planning, not financial advice. Banks and institutions may calculate differently (rounding, fees, rate changes). Confirm figures with your lender or a qualified adviser before deciding.
About the Break-Even Calculator
Your break-even point is the sales volume at which revenue exactly covers all costs — below it you make a loss, above it a profit. Enter your fixed costs for a period, the variable cost of each unit and your selling price, and the calculator shows how many units (and how much in sales) you need, how much each sale contributes, and a chart of where the lines cross.
Add a target profit to see the sales you need to earn it, and your expected sales to see the margin of safety — how far sales can fall before you start losing money.
How to use it
- Choose the period (month, quarter or year) and enter your fixed costs for that period.
- Enter the variable cost per unit and the selling price per unit (excluding GST if registered).
- Optionally add a target profit and your expected sales in units.
- Read the break-even units and sales, then use the chart and table to see profit at other volumes.
Examples
Variable cost ₹300 per unit · Price ₹500 per unit · Expected sales 800 units
Contribution ₹200 per unit (40%) Break-even 600 units = ₹3,00,000 of sales Margin of safety 25% (200 units) · Profit at 800 units ₹40,000
850 units = ₹4,25,000 of sales
The formulas
- Contribution margin per unit = Price − Variable cost per unit
- Contribution margin ratio = Contribution margin ÷ Price
- Break-even units = Fixed costs ÷ Contribution margin per unit (rounded up — you cannot sell part of a unit)
- Break-even sales = Fixed costs ÷ Contribution margin ratio
- Units for a target profit = (Fixed costs + Target profit) ÷ Contribution margin per unit
- Margin of safety = (Expected sales − Break-even sales) ÷ Expected sales
Fixed or variable?
Fixed costs stay the same whatever you sell in the period: rent, salaries, insurance, loan instalments, software subscriptions. Variable costs rise with every unit: raw materials, packaging, payment-gateway and marketplace fees, sales commission, delivery. Some costs are mixed (an electricity bill has a fixed part and a usage part) — split them as well as you can.
Ways to lower your break-even point
- Raise the price — each unit then contributes more. Check the effect on demand first.
- Cut variable costs — cheaper inputs, better shipping rates or lower platform fees raise the contribution on every sale.
- Reduce fixed costs — every rupee of fixed cost saved needs fewer units to cover it.
The contribution margin ratio tells you how much of each extra rupee of sales goes to fixed costs and profit: at 40%, ₹1,00,000 of extra sales adds ₹40,000.
Limitations
- Assumes a single product (or an average product mix), a constant price and a constant variable cost per unit. Discounts, bulk prices and step changes in fixed costs move the real break-even point.
- Enter amounts excluding GST if you are registered for GST; the tax you collect is not revenue.
Privacy
Everything happens in your browser. What you enter or open here is not uploaded or stored by MySmartCoPilot.
Frequently asked questions
What is a contribution margin?
The part of each sale left after paying its variable costs. It first "contributes" to paying fixed costs; once those are covered, it is profit.
Why is there no break-even point for my numbers?
If the price is equal to or below the variable cost, each sale adds nothing (or loses money), so no sales volume can cover fixed costs. You need a higher price or lower variable costs.
How do I break even with several products?
Use a weighted average: the average price and average variable cost per unit across your usual sales mix. The result is the total number of units, in that mix, you need to sell.
What is a good margin of safety?
The higher the better: a 25% margin of safety means sales can fall by a quarter before you make a loss. Businesses with uncertain or seasonal demand usually want a larger cushion.