Free Tool — Break-Even Calculator
Break-Even Point Calculator
Enter your fixed costs, price and variable cost per unit to see exactly how much you need to sell to break even.
Break-even units
1,250 units
Break-even revenue
₹1,25,000.00
Contribution margin
40%
Know your number before the month starts
Your break-even point is the level of sales where revenue exactly covers your costs — sell less and you're in a loss, sell more and every extra unit is pure contribution to profit. It's one of the most useful numbers in a business because it turns rent, salaries and other fixed costs into a single, concrete sales target.
Enter your monthly fixed costs (rent, salaries, subscriptions), your variable cost per unit (ingredients, packaging, per-order costs) and your selling price, and this calculator works out the units and revenue you need to hit before you're in profit.
Break-even point formula
Contribution per unit = Selling price per unit − Variable cost per unit. Contribution margin % = Contribution per unit ÷ Selling price per unit × 100. Break-even units = Fixed costs ÷ Contribution per unit. Break-even revenue = Break-even units × Selling price per unit. If the selling price is not higher than the variable cost, there is no break-even point and the calculator shows a warning instead of results.
How to use the break-even calculator
- 1Add up the costs you pay every month whatever your sales, such as rent, staff salaries, fixed electricity charges and software subscriptions, and enter the total in Fixed costs (per month).
- 2Decide what one unit means for your business: a product, a plate or an average bill. Use that same unit for the next two fields.
- 3Enter the Variable cost per unit: everything you spend each time you sell one unit, such as ingredients, packaging, delivery app commission and card payment charges.
- 4Enter the Selling price per unit as the amount you actually receive, after any regular discount and before GST.
- 5Read Break-even units, Break-even revenue and Contribution margin. They update as you type.
- 6Divide the break-even units or revenue by the number of days you are open to get a daily sales target.
Worked example: break-even for a café with ₹1,80,000 monthly costs
A café pays ₹70,000 rent, ₹90,000 in salaries and about ₹20,000 for electricity, internet and software each month, so its fixed costs are ₹1,80,000. Its average bill is ₹400, and the ingredients, packaging and payment charges behind that bill come to ₹160. Each bill therefore contributes ₹400 − ₹160 = ₹240, a contribution margin of 60%. The break-even calculator divides ₹1,80,000 by ₹240 and shows 750 bills, or ₹3,00,000 in sales (750 × ₹400). Open 30 days a month, that is 25 bills or ₹10,000 of sales a day.
Now suppose milk and coffee prices push the variable cost to ₹200 per bill while menu prices stay the same. Contribution drops to ₹200, and break-even rises to ₹1,80,000 ÷ ₹200 = 900 bills, or ₹3,60,000 in sales. A ₹40 rise in cost per bill means 150 more bills every month, 20% more, just to reach zero profit. Whenever a supplier raises rates, recheck your contribution margin before deciding whether menu prices need to move.
Break-even mistakes to avoid
- Leaving out your own salary. If you work full time in the business, add a fair monthly drawing to fixed costs, or break-even will look easier than it is.
- Counting only ingredients as variable costs. Delivery app commission, packaging, card payment charges (MDR) and per-order staff incentives also rise with every sale.
- Ignoring loan repayments. The principal part of an EMI is not an expense in your P&L, but it still needs cash, so add EMIs to fixed costs if you want a cash break-even figure.
- Reading the units as exact. Break-even units are rounded to the nearest whole number on screen; when planning, round any fraction up, since 642.3 bills shows as 642 but means you need 643.
- Planning around an average month. Seasonal businesses should check break-even against their slowest months, not the yearly average.
- Calculating once and forgetting it. Re-run the numbers whenever rent, salaries, supplier rates or menu prices change.
Break-even calculator FAQs
Break-even units = Fixed Costs ÷ (Selling Price per unit − Variable Cost per unit). Multiply the result by the selling price to get break-even revenue.
Fixed costs stay roughly the same regardless of sales volume — rent, salaries, software subscriptions. Variable costs scale with each unit sold — ingredients, packaging, payment gateway fees per order.
It converts your overheads into a daily or monthly sales target, which makes it much easier to judge whether a location, menu price or staffing level is realistic before you commit to it.
Contribution margin is the selling price minus the variable cost per unit — the amount each sale contributes toward covering fixed costs. A higher contribution margin means you break even with fewer units sold.
This happens when the selling price per unit is equal to or lower than the variable cost per unit. Each sale then adds nothing, or loses money, before fixed costs are even counted, so no sales volume can cover rent and salaries. The calculator shows a warning instead of results. Raise the price or cut the variable cost, and check that you have not compared a GST-inclusive cost with a pre-GST price.
Margin of safety is how far your actual sales sit above break-even. Subtract break-even revenue from your current monthly sales, then divide by current sales for a percentage. If you sell ₹3,60,000 a month and break even at ₹3,00,000, your margin of safety is ₹60,000, or about 16.7%. The bigger this cushion, the better you can absorb a slow month or a cost increase.
If you are a regular GST-registered business, no. The GST you collect is passed on to the government, so enter the selling price before tax, and enter purchase costs net of any input tax credit you can claim. Under the composition scheme you cannot collect GST from customers or claim input tax credit, so treat the tax you pay on turnover as a variable cost and enter purchase costs including GST.
Yes, it is free to use with no sign-up, and the results update as you type. It does not save your inputs: reloading the page brings back the sample figures. Note down your fixed costs, variable cost and selling price, or keep them in a spreadsheet, so you can re-run the calculation quickly when costs or prices change.
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