Break Even Calculator

Find how many units you must sell to break even.

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This break-even calculator tells you how many units you need to sell before a product or business stops losing money. Enter your fixed costs, the selling price per unit and the variable cost per unit, and it shows the break-even quantity, the revenue at that point and the contribution each sale makes.

The break-even formula

Contribution per unit = price − variable cost per unit
Break-even units = fixed costs ÷ contribution per unit

Fixed costs stay the same whether you sell one unit or a thousand: rent, salaries, software subscriptions, loan EMIs. Variable costs rise with every sale: raw materials, packaging, delivery, payment gateway fees and marketplace or food-app commission. Each sale's contribution is what's left to pay off the fixed costs; once they are covered, contribution becomes profit.

Worked example: a home bakery

A home bakery sells boxes of cupcakes at ₹180. Ingredients, box and delivery cost ₹110 per box. Monthly fixed costs (a small kitchen rental, one helper's salary, gas and internet) come to ₹50,000.

Contribution per unit: ₹180 − ₹110 = ₹70
Break-even: ₹50,000 ÷ ₹70 = 714.29, which the tool rounds up to 715 boxes a month, because you can't sell a fraction of a box
Revenue at break-even: shown as ₹1,28,571.43, calculated from the exact 714.29 boxes; actually selling 715 brings in ₹1,28,700

You can check the revenue figure another way. The contribution margin ratio is ₹70 ÷ ₹180 = 38.9%, and ₹50,000 ÷ 0.389 gives the same break-even sales of about ₹1.29 lakh.

Testing what-if scenarios

Change	Contribution	Break-even
Starting point	₹70	715 boxes
Price raised to ₹200	₹90	556 boxes
Variable cost cut to ₹100	₹80	625 boxes

A ₹20 price rise cuts the target by over 150 boxes, which is why small pricing changes matter so much for thin-margin businesses. If you expect to sell 900 boxes, your margin of safety is (900 − 715) ÷ 900, about 21%: sales could fall that much before you start losing money.

You can also use the calculator for payback on a one-time investment. Enter a ₹3,00,000 oven and fit-out as the fixed cost, and at ₹70 contribution you need 4,286 boxes to recover it.

Getting the inputs right

Leave GST out. If you are GST-registered, the tax you collect goes to the government, so enter prices and costs excluding GST. The GST calculator strips it out of inclusive prices.
Include percentage fees as rupees. A 20% aggregator commission on a ₹180 sale is ₹36 of variable cost.
Price must exceed variable cost. If it doesn't, every sale loses money and the tool shows an error, because no quantity can ever break even.
Use the same period throughout. Monthly fixed costs give a monthly break-even quantity.

What a single break-even number can't show

The model assumes one product with a fixed price and cost. With several products, use a weighted average contribution based on your sales mix. Fixed costs also rise in steps: hiring a second helper resets the target. And the calculation says nothing about whether customers will pay the higher price; test it before relying on it. For per-sale profitability, the profit margin calculator shows margin and markup. These results are planning estimates, not accounting or financial advice.

Frequently asked questions

What is the difference between fixed and variable costs?

Fixed costs, like rent and salaries, stay the same regardless of sales volume. Variable costs, like materials, packaging and delivery, rise with every unit sold.

Why does the calculator round the break-even units up?

You cannot sell part of a unit, and selling one unit fewer than the exact figure would still leave a small loss. Rounding up gives the first whole quantity that covers all fixed costs.

Should I include GST in the price per unit?

If you are GST-registered, no. Enter prices and costs excluding GST, because the tax you collect is passed on to the government and is not your revenue.

Why do I get an error saying price must exceed variable cost?

If each sale costs more to produce than it earns, contribution is zero or negative and no amount of sales can cover fixed costs. Raise the price or lower the variable cost.

How do I calculate break-even for several products?

Work out a weighted average contribution per unit from your expected sales mix, then divide total fixed costs by that average.

Can I use this to find how long it takes to recover an investment?

Yes. Enter the one-time investment as the fixed cost to get the units needed, then divide by your expected monthly sales to estimate the months to payback.