Break-Even Calculator
Enter your fixed costs, the cost of producing one more unit and the price you charge. The calculator tells you how many units and how much revenue you need before you stop losing money.
Created by the Reeliy Editorial Team. Last updated: Oct 19, 2026
How to use the break-even calculator
Fill in the first two boxes with what the business spends, then describe the selling price in whichever form you know it.
- Fixed costs: money spent regardless of volume, such as equipment, set-up, rent or a licence.
- Cost per unit: the extra cost of making or buying each additional unit (materials, packaging, per-item fees). It cannot be zero.
- Expecting to sell (optional): your average monthly sales volume. If you fill it in, the results include how many months it takes to break even.
- Revenue per unit, margin or markup: enter just one of the three. Revenue per unit is the selling price. Margin is the share of the price that is profit. Markup is the percentage added on top of cost to reach the price.
If you enter more than one of the three, the revenue per unit is used and the other two are recomputed from it. When revenue is empty, it is worked out from the margin, or failing that the markup, and rounded to the cent.
The results give the number of units to sell, the revenue those sales represent, the break-even time, and the margin and markup implied by your price. A table below the results shows sales, total costs and profit at volumes from zero up to twice the break-even quantity.
Break-even formulas
Each unit sold brings in its price and uses up its own cost. The difference, called the contribution margin per unit, is what is left to pay down the fixed costs. The break-even point is reached when enough contributions have piled up to cover them.
contribution per unit = price − cost per unit
break-even units = fixed costs ÷ (price − cost per unit)
break-even revenue = break-even units × price
Margin and markup describe the same contribution against different bases, so each can be converted into the other:
margin = (price − cost) ÷ price × 100 markup = (price − cost) ÷ cost × 100
margin = markup ÷ (100 + markup) × 100 markup = margin ÷ (100 − margin) × 100
A 100% markup, for example, is a 50% margin, and a 25% margin is a 33.3% markup. The markup calculator and profit margin calculator work with these conversions directly.
To plan for a profit rather than just to break even, add the profit you want to the fixed costs: units needed = (fixed costs + target profit) ÷ contribution per unit.
Worked example: a small candle business
A maker spends $12,000 up front on moulds, a workspace set-up and a first website. Each candle costs $2.40 in wax, jar and label, and is sold for $5.00.
- Contribution per candle: 5.00 − 2.40 = $2.60.
- Break-even units: 12,000 ÷ 2.60 = 4,615.38, so the 4,616th candle is the first that produces a profit.
- Break-even revenue: 4,615.38 × 5.00 = $23,076.92.
- Margin: 2.60 ÷ 5.00 = 52%. Markup: 2.60 ÷ 2.40 = 108.33%.
| Candles sold | Revenue | Total costs | Profit or loss |
|---|---|---|---|
| 0 | $0.00 | $12,000.00 | -$12,000.00 |
| 2,307.69 | $11,538.46 | $17,538.46 | -$6,000.00 |
| 4,615.38 | $23,076.92 | $23,076.92 | $0.00 |
| 6,923.08 | $34,615.38 | $28,615.38 | $6,000.00 |
| 9,230.77 | $46,153.85 | $34,153.85 | $12,000.00 |
If the maker expects to sell 600 candles a month, break-even takes 4,615.38 ÷ 600 = 7.7 months. The calculator reports whole months rounded down, so it shows 7; in practice the break-even point falls during the eighth month. To clear a $3,000 profit as well, the target becomes (12,000 + 3,000) ÷ 2.60 = 5,769.23 candles. Raising the price to $5.50 would cut break-even to 12,000 ÷ 3.10 = 3,870.97 candles.
Assumptions and limits
Break-even analysis is a deliberately simple model, and it is only as good as its assumptions:
- The price and the cost per unit stay constant. Volume discounts, promotions and supplier price changes break this.
- Fixed costs really stay fixed. In practice they step up when you add a second shift, a new location or more staff.
- Everything produced is sold. Unsold stock ties up cash without producing revenue.
- One product. For a mix of products, use a weighted-average price and cost, or analyse each line separately.
- Fixed costs are treated as a single up-front amount. If they are recurring (monthly rent, say), compute break-even for one period of fixed costs against that period's sales instead.
If the price is below the cost per unit, every sale deepens the loss and the arithmetic returns negative quantities. If they are equal there is no contribution at all, so the calculator reports an error. The break-even point also ignores the time value of money; for longer projects compare it with the return on investment and the return on sales.
Break-even figures are planning estimates based on the numbers you supply and are not financial advice. See the disclaimer.
Using the result in decisions
Compare the break-even quantity with realistic demand. If you would need to sell more than the market can plausibly absorb, the plan needs a higher price, a lower cost per unit or smaller fixed costs. The gap between expected sales and the break-even volume is the margin of safety: in the candle example, selling 6,000 candles leaves (6,000 − 4,615.38) ÷ 6,000 = 23% headroom before a loss.
Run the calculator several times with different prices to see how sensitive the result is. Because the price sits in the denominator of the break-even formula, even a small rise lowers the required volume noticeably, and a saving on the cost per unit has exactly the same effect.
Frequently asked questions
What is the break-even point?
It is the sales volume at which total revenue equals total costs, so the business neither makes a profit nor a loss. Every unit sold beyond it adds its contribution margin as profit.
Do I have to fill in revenue per unit, margin and markup?
No. Enter just one of the three. If you provide several, revenue per unit takes priority and the margin and markup shown are recomputed from it.
What counts as a fixed cost and what is a cost per unit?
Fixed costs do not change with the number of units made, such as rent, equipment or software subscriptions. The cost per unit rises with every unit, for example materials, packaging and payment fees.
Why does the calculator say the cost per unit cannot equal the revenue per unit?
When price and cost are the same, each sale contributes nothing toward the fixed costs, so no number of sales would ever break even and the formula would divide by zero.
How is the break-even time calculated?
It divides the break-even units by the monthly sales you expect and rounds down to whole months. It assumes the fixed costs are a one-time outlay and that sales are steady.
Cite this calculator and page
If you use this page in your work, you can cite it as:
Reeliy Editorial Team. (2026). Break-Even Calculator. Reeliy. https://reeliy.com/calculators/break-even-calculator“Break-Even Calculator.” Reeliy, 2026, https://reeliy.com/calculators/break-even-calculator.