Break-Even Calculator — where losing stops
Fixed costs, price per unit or job, variable cost per unit — and out comes the number of sales where your business stops paying to exist and starts earning.
One formula, read three ways
Break-even = fixed costs ÷ contribution per unit, where contribution is price minus variable cost. It reads three ways: as a target (25 jobs this month before profit), as a price check (if contribution is thin, break-even is impossibly high — the price is the problem, not the volume), and as a stress test (add a hire or a van payment to fixed costs and watch what it does to the target before you commit).
Worked example
| Fixed costs / mo | Price per job | Variable cost | Contribution | Break-even |
|---|---|---|---|---|
| $3,000 | $250 | $130 | $120 | 25 jobs · $6,250 |
| $3,000 | $300 | $130 | $170 | 18 jobs · $5,400 |
| $4,500 | $250 | $130 | $120 | 38 jobs · $9,500 |
The middle row is the quiet lesson: a $50 price increase cut the target from 25 jobs to 18 — volume is hard to add, price often isn't. The margin calculator prices that increase properly.
Feeding the inputs honestly
Put your own pay in fixed costs — a business that breaks even without paying you hasn't broken even. Variable costs come from your real jobs: marked-up materials (the markup calculator keeps those consistent), fuel, processing fees. And if you sell time rather than units, run the hourly rate calculator — it's the same mathematics solved for your rate instead of your volume.
After break-even: bill like it matters
Every job past the line is profit — if it gets invoiced and paid. The free invoice generator turns the job into a clean, tax-correct PDF in under a minute, and the payment reminder generator chases the slow ones so contribution actually lands in the account.
Frequently asked questions
How is the break-even point calculated?
Break-even units = fixed costs ÷ (price per unit − variable cost per unit). With $3,000/month of fixed costs, a $250 job price and $130 of variable costs per job, each job contributes $120 — so you need $3,000 ÷ $120 = 25 jobs a month before profit starts.
What are fixed costs vs variable costs?
Fixed costs arrive whether you sell or not: rent, insurance, software, loan payments, base phone plan. Variable costs come only with each sale: materials, fuel for the job, card processing fees, subcontracted labour. The split is what makes the formula work.
What is contribution margin?
Price minus variable cost — the slice of every sale left to pay fixed costs, and after break-even, to become profit. A $250 job with $130 variable cost contributes $120. If contribution is zero or negative, no volume of sales ever reaches profit; the price is wrong.
Should I calculate break-even monthly or yearly?
Both are valid — just keep the periods consistent: monthly fixed costs give a monthly break-even, yearly gives yearly. Monthly is usually the more actionable view for a small business, since rent and subscriptions bill monthly.
Why did the calculator round my units up?
Because you can't sell 24.6 jobs. Break-even units always round up to the next whole unit — at 24 jobs you're still marginally short, at 25 you've crossed. The revenue figure shown is those whole units × price.
Does break-even include my own pay?
Only if you put it there — and you should. Add the salary you need to fixed costs; a business that only breaks even before paying you is running a loss with extra steps. That pay figure is exactly what the hourly rate calculator derives from the other direction.
What do I do with the number?
Compare it to reality. If break-even is 25 jobs and you book 40, you have room; if it's 25 and you book 20, either raise prices (see the margin calculator), cut costs, or increase volume. Then bill every one of those jobs cleanly with the free invoice generator.