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Break-even Calculator

Break-even is the sales volume where you stop losing money. Enter your fixed costs for the month, the selling price per unit and the variable cost per unit to see how many units you must sell.

It is the fastest sanity check before signing a rent agreement, hiring staff or launching a new product line.

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₹

Rent, salaries, subscriptions — costs that do not change with volume.

₹
₹

Materials, packing, per-order shipping and commissions.

Break-even point

Contribution per unit
₹200.00
Contribution margin
40%
Break-even units
600 units
Break-even revenue
₹3,00,000.00
Units are rounded up — you cannot sell part of an order.

Formula

Contribution per unit = Price − Variable cost

Break-even units = Fixed costs ÷ Contribution per unit

Break-even revenue = Break-even units × Price

If the contribution per unit is zero or negative, no volume can cover fixed costs — the price or the cost has to change.

Worked example

Fixed costs ₹1,20,000, price ₹500 and variable cost ₹300 give a contribution of ₹200, so you need 600 units and ₹3,00,000 of revenue to break even.

How to use this calculator

  1. 1Enter your fixed costs for the month — rent, salaries, subscriptions, loan EMIs.
  2. 2Enter the selling price and the variable cost of one unit.
  3. 3Read the break-even units and revenue you need before you start making a profit.

When businesses use it

  • Deciding whether a second shop or counter can cover its own rent.
  • Setting a monthly sales target that keeps the business cash-positive.
  • Testing how many units a price cut would need to make up.

Reading your break-even point

Break-even is the sales level where contribution exactly covers fixed costs. Contribution is what one unit leaves behind after its own variable cost, and fixed costs are everything the business pays whether or not it sells anything — rent, salaries, internet, licence fees, loan interest. Dividing one by the other tells you the volume below which you are funding the business out of your own pocket.

Cost classification decides the answer. Rent and staff salaries are fixed, materials and packing are variable, and electricity is usually a mix. Delivery charges belong with variable costs if they scale with orders. Misclassifying a large semi-fixed cost can move the break-even point by 20% or more, so it is worth splitting the ambiguous items rather than dumping them in one bucket.

Use the number forward, not just backward. Before signing a longer lease, hiring a second employee or launching a product, add the new fixed cost and see the volume it demands. If the required increase in sales looks unrealistic against your last six months, the commitment is too large for the current business.

Ways to bring the break-even point down

  • Raise the price slightly — contribution improves faster than volume falls on most lines.
  • Renegotiate purchase cost or reduce wastage to widen contribution per unit.
  • Convert fixed costs to variable, such as commission-based staff or per-order logistics.
  • Cut fixed costs that do not generate sales before touching those that do.

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Calculations happen instantly in your browser. Your calculator inputs aren't sent to our servers. KaroDesk provides calculations and information for general informational purposes. Results should be verified against applicable laws, official notifications, employer policies, lender terms, or professional advice where appropriate. Read our full disclaimer.