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Break-even calculator

How much do you need to sell each month before you start making a profit? Enter your fixed costs and per-unit numbers.

Rent, salaries, electricity, internet, loan EMI, insurance.
Break-even point
0 units

The break-even formula

Contribution per unit = Selling price − Variable cost per unit

Break-even units = Fixed costs ÷ Contribution per unit

Example: fixed costs ₹60,000 a month, price ₹250, variable cost ₹170. Each unit contributes ₹80, so you need 750 units (₹1,87,500 of sales) a month to break even. Every unit after that adds ₹80 of profit.

If you sell many products, use averages: average bill value as the price, and your overall cost of goods as a share of sales for variable cost.

Three ways to lower your break-even point

  1. Raise contribution: better buying prices or small price increases on items customers do not compare.
  2. Cut fixed costs: renegotiate rent, share delivery, switch to cheaper plans.
  3. Change the mix: push higher-margin products. See the margin calculator.

Questions about break-even

What counts as a fixed cost?

Costs that stay the same whatever you sell in a month: rent, permanent staff salaries, loan EMIs, software subscriptions and insurance.

What is margin of safety?

How far your expected sales are above break-even, as a percentage. A 25% margin of safety means sales can fall by a quarter before you start losing money.