Break-Even Calculator
With Scenario TableFind your break-even point in units and revenue. Calculate contribution margin, margin of safety, and units required for your target profit — all instantly.
Business Inputs
Rent, salaries, insurance, depreciation — costs that don't change with production.
Raw materials, packaging, commission — costs that vary with each unit sold.
Contribution Margin
₹200/unit
= Selling Price − Variable Cost
40.0%
CM Ratio
Break-Even Units
1,000
units to sell
Break-Even Revenue
₹5,00,000
revenue needed
Units Required
How far sales can drop from target before hitting break-even
Key Metrics
Fixed Costs
₹2,00,000
Variable Cost/unit
₹300
Selling Price/unit
₹500
Contribution Margin
₹200
CM Ratio
40.0%
Margin of Safety
33.3%
Break-Even Formulas Explained
Number of units you must sell to cover all costs.
Total revenue needed to cover all fixed and variable costs.
How much each unit sold contributes toward fixed costs and profit.
How much sales can drop before you start making a loss.
How to Use the Calculator
Fixed Costs
Enter total periodic fixed costs — rent, salaries, and overheads that don't change.
Selling Price
Enter your selling price per unit or per customer transaction.
Variable Cost
Enter cost per unit — materials, labour, packaging, commission.
Target Profit
Set your desired profit goal to see how many units you need beyond BEP.
Fixed Costs vs Variable Costs
Fixed Costs
- Office / factory rent
- Employee salaries
- Insurance premiums
- Loan EMIs
- Software subscriptions
- Depreciation on equipment
Variable Costs
- Raw materials
- Packaging per unit
- Sales commission
- Direct labour per unit
- Shipping per order
- Payment gateway fees
When to Use Break-Even Analysis
Launching a New Product
Understand the minimum sales needed before investing in production or marketing.
Setting Price Points
Evaluate whether your current pricing covers all costs at realistic sales volumes.
Cost Reduction Decisions
See how much your BEP drops when you reduce fixed or variable costs.
Expansion Planning
Before adding capacity, calculate the additional sales needed to cover new fixed costs.
Bulk Order Pricing
Determine the minimum discount you can offer on bulk orders while still covering costs.
Investor Presentations
Show investors when your business will become profitable at different sales scenarios.
Frequently Asked Questions
What is the break-even point?
The break-even point (BEP) is the level of sales at which total revenue equals total costs, resulting in zero profit or loss. Below the BEP, a business makes a loss; above it, a business makes a profit. It is a critical metric for pricing, budgeting, and feasibility analysis.
What is the break-even formula?
Break-Even Units = Fixed Costs ÷ Contribution Margin Per Unit, where Contribution Margin = Selling Price − Variable Cost per unit. Break-Even Revenue = Break-Even Units × Selling Price. Alternatively, Break-Even Revenue = Fixed Costs ÷ Contribution Margin Ratio.
What is contribution margin?
Contribution margin is the selling price minus variable cost per unit. It represents how much each unit sold "contributes" toward covering fixed costs and generating profit. A higher contribution margin means fewer units are needed to break even.
What is margin of safety?
Margin of safety is the difference between actual or projected sales and the break-even sales. It shows by how much sales can fall before the business starts making a loss. Expressed as a percentage: (Sales − BEP Sales) ÷ Sales × 100. A higher margin of safety is better.
What are fixed costs vs variable costs?
Fixed costs remain constant regardless of production volume — examples include rent, salaries, insurance, and loan EMIs. Variable costs change in proportion to production — examples include raw materials, packaging, sales commission, and direct labour per unit.
How is break-even analysis used in business decisions?
Break-even analysis helps businesses set minimum pricing, evaluate new products, plan production volumes, assess risk before launching, decide whether to accept a bulk order at a discount, and determine how much sales growth is needed to justify a cost increase.