Break Even
The break-even point is the revenue level at which total costs equal total revenue — where you stop losing money and start making it. Every business decision (launch a new product? hire another person? rent a bigger space?) shifts fixed and variable costs, changing the break-even point. Our break-even calculator computes units and revenue needed to cover costs, and shows a visual contribution margin waterfall.
Rent, salaries, software subscriptions — costs that don't change with output
Materials, direct labor, shipping — costs that scale with each unit sold
Le prix facturé à chaque client pour une unité ou heure de service
Unités au seuil de rentabilité
Unités nécessaires pour couvrir tous les coûts
What is the Break-Even Point?
The break-even point is the level of sales at which your total revenue exactly equals your total costs — meaning you are neither making a profit nor incurring a loss. Every unit sold beyond the break-even point contributes directly to profit.
The formula is straightforward: Break-Even Units = Fixed Costs ÷ (Selling Price − Variable Cost per Unit). The denominator — Selling Price minus Variable Cost — is called the contribution margin. It represents how much each sale contributes toward covering your fixed costs before profit begins.
For service-based freelancers, a "unit" is typically one hour of billable work or one project. Knowing your break-even number helps you set realistic monthly revenue goals and price your services with confidence.
Comment réduire votre seuil de rentabilité
There are three levers you can pull to reduce your break-even point and reach profitability faster. First, raise your prices. Even a modest increase in your selling price dramatically improves your contribution margin and lowers the number of units you need to sell.
Second, reduce your variable costs. Negotiate better rates with suppliers, streamline your production process, or find more efficient tools and software. Lower variable costs per unit mean each sale contributes more toward covering your fixed overhead.
Third, cut unnecessary fixed costs. Review every recurring expense — subscriptions, office space, tools — and eliminate anything that does not directly support revenue generation. Reducing fixed costs lowers the threshold you must cross before becoming profitable each month.
À propos de Break-Even Calculator
The break-even point is the revenue level at which total costs equal total revenue — where you stop losing money and start making it. Every business decision (launch a new product? hire another person? rent a bigger space?) shifts fixed and variable costs, changing the break-even point. Our break-even calculator computes units and revenue needed to cover costs, and shows a visual contribution margin waterfall.
Comment l'utiliser
- Enter total fixed costs (rent, salaries, insurance — costs that don't change with volume).
- Enter the selling price per unit and variable cost per unit.
- See the break-even in units and in revenue.
- Add a profit target to see the sales volume needed to reach that profit.
Formule et méthodologie
Contribution margin per unit = Selling price − Variable cost. Break-even units = Fixed costs ÷ Contribution margin per unit. Break-even revenue = Fixed costs ÷ Contribution margin ratio. CM ratio = Contribution margin / Selling price.
Cas d'usage courants
- Deciding the minimum price to cover costs on a new product
- Calculating how many units/clients you need before a new hire pays off
- Stress-testing a business plan before launch
- Negotiating a lease by understanding how rent changes break-even
- Modeling a price cut and its effect on required volume
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