Profit Margin Calculator
Calculate profit margin vs markup — understand the difference and optimise your pricing.
Break-Even Calculator
Find the exact sales volume needed to cover all your costs and break even.
Enter your costs and price, then click Calculate to find your break-even point.
How it works?
The break-even point is the level of sales at which total revenue exactly equals total costs — no profit, no loss. The formula is: BEP (units) = Fixed Costs ÷ Contribution Margin per Unit, where Contribution Margin = Selling Price − Variable Cost per Unit.
The Units tab suits product businesses: enter your price, variable cost per unit, and total fixed costs. The Revenue % tab suits service businesses where variable costs are a percentage of revenue — enter the percentage and fixed costs to find your break-even revenue directly.
Add an optional target profit to find the sales volume needed to hit a specific profit goal. The formula simply adds the target to fixed costs before dividing: (Fixed Costs + Target Profit) ÷ CM per Unit.
Frequently asked questions
What is break-even analysis?
Break-even analysis determines the minimum sales volume at which a business covers all its costs. Below the break-even point, the business makes a loss; above it, every additional unit (or unit of revenue) contributes pure profit. It is one of the most fundamental tools in pricing, budgeting, and business planning.
What is contribution margin and why does it matter?
Contribution margin is the amount each unit sold contributes toward covering fixed costs and then generating profit: CM = Selling Price − Variable Cost. A higher contribution margin means you reach break-even faster. If CM is zero or negative, you cannot break even regardless of volume — every unit sold at a loss makes the situation worse.
What should I include in fixed costs?
Fixed costs are expenses that do not change with output volume: rent, salaries, insurance, loan repayments, software subscriptions, depreciation, and similar overhead. Do not include costs that vary with each unit sold (those are variable costs). Use the same time period consistently — if your rent is monthly, use all costs on a monthly basis and interpret the result as the units needed per month.
What counts as a variable cost?
Variable costs change directly with the number of units produced or sold: raw materials, packaging, payment processing fees, shipping, sales commissions, and direct labour (if paid per unit). For service businesses, variable costs are often a percentage of revenue — for example, a consultant who pays a 15% platform fee has a 15% variable cost ratio, leaving an 85% contribution margin ratio.
How can I lower my break-even point?
You have three levers: (1) Reduce fixed costs — renegotiate rent, cut subscriptions, outsource instead of hiring. (2) Reduce variable costs — bulk purchasing, more efficient processes, better supplier terms. (3) Increase your selling price — even a small price increase can dramatically lower the break-even point because the full increase flows directly to contribution margin. A combination of all three is usually most effective.