Break-Even Analysis Calculator
Free break-even calculator for small business. Find break-even units, revenue, and margin of safety. Map your path to profitability with clear sales targets.
Unit Economics Calculator
Free unit economics calculator. Analyze per-unit revenue, costs, and contribution. Project path to profitability at scale and visualize break-even volume.
$
$
$
For projection
%
Contribution/Unit
$20.00
Margin
40%
Break-Even
1,000.00 units
Current Profit/Loss⧉
-$4,000.00
Below break-even
Current Revenue⧉
$40,000.00
800 units × $50.00
Variable Costs⧉
$24,000.00
800 units × $30.00
Fixed Costs⧉
$20,000.00
Monthly overhead
Break-Even Revenue⧉
$50,000.00
1,000.00 units needed
Months to Break-Even⧉
3 months
At 10% monthly growth
Revenue Breakdown (per unit)
Variable 60%
Contribution 40%
Volume Scenarios
| Volume | Revenue | Variable | Contribution | Fixed | Profit | Status |
|---|---|---|---|---|---|---|
| 500.00 | $25,000.00 | $15,000.00 | $10,000.00 | $20,000.00 | -$10,000.00 | Loss |
| 750.00 | $37,500.00 | $22,500.00 | $15,000.00 | $20,000.00 | -$5,000.00 | Loss |
| 1,000.00 | $50,000.00 | $30,000.00 | $20,000.00 | $20,000.00 | $0.00 | Break-Even |
| 1,250.00 | $62,500.00 | $37,500.00 | $25,000.00 | $20,000.00 | $5,000.00 | Profitable |
| 1,500.00 | $75,000.00 | $45,000.00 | $30,000.00 | $20,000.00 | $10,000.00 | Profitable |
| 2,000.00 | $100,000.00 | $60,000.00 | $40,000.00 | $20,000.00 | $20,000.00 | Profitable |
12-Month Growth Projection
| Month | Volume | Revenue | Profit/Loss |
|---|---|---|---|
| 0 | 800.00 | $40,000.00 | -$4,000.00 |
| 3 | 1,065.00 | $53,250.00 | $1,300.00 |
| 6 | 1,417.00 | $70,850.00 | $8,340.00 |
| 9 | 1,886.00 | $94,300.00 | $17,720.00 |
| 12 | 2,511.00 | $125,550.00 | $30,220.00 |
Assumes constant unit economics at all volumes. In practice, economies of scale may improve margin at higher volumes.
Planning notes, formulas, and examples
About the Unit Economics Calculator
Unit economics answers the fundamental question: do you make money on each unit sold? Unit = a customer, a transaction, a product — whatever your business "sells." If each unit generates positive contribution after variable costs, the business can scale profitably.
Unit economics consists of: revenue per unit, variable cost per unit, contribution per unit, and contribution margin %. Add fixed costs and you get the break-even volume — the number of units needed to cover all costs.
This calculator analyzes per-unit economics, shows the break-even point, and projects profitability across different volume scenarios. If each unit you sell does not generate a profit after direct costs, no amount of volume will save the business. Positive unit economics means that every additional sale adds real margin; negative unit economics means every sale deepens the loss. This is the clearest signal of whether a business model is viable, and investors scrutinize it closely before committing capital.
When This Page Helps
Positive unit economics is the prerequisite for sustainable growth. Scaling a business with negative unit economics means losing more money faster. Investors, operators, and founders use unit economics to validate business models, set pricing, and plan growth. Monitoring unit economics as you scale ensures that growth does not quietly erode margins. If contribution margin trends downward, you need to adjust pricing or costs before the problem compounds.
How to Use the Inputs
- Enter revenue per unit (price per product, ARPU, etc.).
- Enter variable costs per unit (COGS, delivery, support, etc.).
- Enter total fixed costs per month.
- View contribution per unit, contribution margin, and break-even volume.
- Explore volume scenarios to project profitability.
Formula used
Contribution per Unit = Revenue per Unit − Variable Cost per Unit
Contribution Margin = Contribution / Revenue × 100%
Break-Even Units = Fixed Costs / Contribution per Unit
Total Profit = (Units × Contribution) − Fixed CostsExample Calculation
Result: Contribution: $20/unit (40%) | Break-even: 1,000 units/month
Revenue $50 − variable cost $30 = $20 contribution per unit (40% margin). Fixed costs of $20K / $20 contribution = 1,000 units to break even. At 1,500 units: profit = (1,500 × $20) − $20K = $10K.
Tips & Best Practices
- Positive contribution margin is the minimum bar. If it's negative, you lose money on every sale — volume won't help.
- Include ALL variable costs: COGS, shipping, payment processing, marginal support, commissions.
- Fixed costs in early-stage startups are mostly people and infrastructure. They're "fixed" but jump in steps as you grow.
- Model 3 scenarios: pessimistic, base, and optimistic to understand the range of outcomes.
- For SaaS, the "unit" is typically a customer. Revenue = ARPU, variable cost = hosting + support per user.
- Use unit economics to set pricing: ensure contribution margin covers fixed overhead at realistic volumes.
The Break-Even Path
Every startup has a path to profitability defined by unit economics. If contribution is $20/unit with $100K in fixed costs, you need 5,000 units/month. At a growth rate of 10% per month starting from 500 units, you reach break-even in about 24 months. This projection drives fundraising needs and runway planning.
Unit Economics by Segment
Averages hide the truth. Your enterprise segment might have $200 contribution with 80% margin, while small business has $20 contribution with 30% margin. Segment-level unit economics reveals where to focus growth and where to improve or abandon.
Scaling Effects
As volume grows, unit economics typically follows a curve: initially negative (high per-unit overhead), then improving rapidly (reaching contribution break-even), then gradually improving (economies of scale), and eventually plateau (variable cost floor). Map your position on this curve to set expectations.
Sources & Methodology
Last updated:
Methodology
This worksheet calculates per-unit contribution as revenue per unit minus variable cost per unit, converts that into a contribution-margin percentage, and then estimates break-even volume by dividing fixed costs by contribution per unit. It also projects profit at higher unit volumes using the same contribution assumption.
The quality of the result depends on how cleanly the user separates variable and fixed costs. If costs are step-fixed, shared across segments, or partly allocated from overhead, the calculator should be treated as a planning worksheet rather than a precise managerial-accounting output.
Sources
- Unit Economics in Startup Settings (Harvard Business School) — HBS technical note on unit economics in startup settings.
- On CUE: The Quest for Optimal Customer Unit Economics (Harvard Business School) — HBS background note on customer unit economics, LTV/CAC framing, and profitability tradeoffs.
Frequently Asked Questions
A unit is whatever you sell: a product, a subscription, a meal, a ride, a transaction. For SaaS, a unit is typically a customer or a seat. For e-commerce, it's an order. For a marketplace, it could be a transaction. Define it consistently for your business model.
Variable costs change with volume: materials, shipping, payment processing, per-user hosting. Fixed costs stay the same regardless of volume: rent, salaries, base infrastructure. In practice, many costs are semi-variable (stepped increases), so categorize by primary behavior.
Not sustainably. If contribution per unit < 0, every additional unit loses more money. Some startups subsidize unit economics temporarily (e.g., Uber's rider subsidies) to gain market share, but the unit economics must eventually turn positive or the business fails.
At higher volumes, fixed costs spread across more units, lowering the per-unit average cost. Variable costs may also decrease through bulk discounts and operational efficiency. However, variable costs per unit usually have a floor that limits how much unit economics can improve.
Contribution margin is one component of unit economics. Unit economics is the broader analysis: revenue per unit, variable cost per unit, contribution, break-even volume, and scale economics. Contribution margin is the per-unit profitability ratio within that framework.
Two levers: (1) Increase revenue per unit — raise prices, upsell, or add premium features. (2) Decrease variable costs — optimize operations, negotiate supplier terms, automate support. Also consider whether some "fixed" costs can be made variable through outsourcing.