Break Even Calculator
Calculate how many units and how much revenue you need to break even. See contribution margin for any price and cost structure.
Break-even units
500
Units to sell to cover fixed costs
Break-even revenue
₹2,50,000
Contribution per unit
₹200
Price 500 − variable 300
Contribution margin
40%
Share of each sale that covers fixed costs
With ₹1,00,000 of monthly fixed costs and ₹200 contributed per sale (₹500 price minus ₹300 variable cost), the business breaks even at 500 units or ₹2,50,000 of revenue per month.
Break Even Calculator on True Calculator gives you an instant, accurate answer with no sign-up and no app install. Calculate how many units and how much revenue you need to break even. See contribution margin for any price and cost structure. Every result shows the formula and a worked example so you can verify the calculation yourself, and all values are computed in your own browser — your numbers never leave your device.
Popular uses: break even calculator · break even point calculator · break even analysis
Reviewed by the True Calculator team · Last updated: August 2026
How We Calculate
This calculator uses standard financial formulas verified by our team. All calculations are performed instantly in your browser using JavaScript — no data is sent to any server.
We use RBI-approved formulas and regularly updated bank rates. All rates and standards are sourced from official government and regulatory websites.
When to Use This Calculator
Break-even analysis tells a business exactly how many sales keep the lights on, which is the first number every Indian entrepreneur should know. A new chai-and-snacks stall, a boutique in a mall, an agency with monthly salaries, or a manufacturer with plant overhead all face the same question: what monthly volume covers the bills? The analysis also drives pricing — if break-even units look unreachable at the current price, either the price rises or variable costs must fall. Restaurants use it to set daily covers, e-commerce sellers use it to plan ad spend against unit contribution, and service providers count completed orders instead of units. Lenders and investors ask for the break-even point before funding small businesses, because it separates realistic ventures from those whose costs outrun their market.
How to Use This Calculator
- Step 1: Enter fixed costs for the period — rent, salaries, utilities that do not change with sales.
- Step 2: Enter the selling price per unit of your product or service.
- Step 3: Enter the variable cost per unit — materials, packaging, delivery and per-unit labour.
- Step 4: Read the units and revenue needed to cover all costs, plus the contribution per unit.
Worked Example
A Surat textile trader rents a showroom for ₹1,00,000 a month and sells kurta sets at ₹500 each, with fabric and tailoring costing ₹300 per set. Each sale contributes ₹200 towards fixed costs — a 40% contribution margin. The break-even point is 500 sets a month, or ₹2,50,000 of revenue. Anything beyond the 500th set is pure profit, while falling short of 500 sets means the month runs at a loss.
Tips and Common Mistakes
- •Tip 1: Re-check the split of costs whenever input prices change — fabric and fuel move variable costs fast in India.
- •Tip 2: Track the break-even units monthly alongside actual sales to spot trouble early.
- •Tip 3: Use the contribution margin to evaluate discounts — a 10% festive discount can cut contribution per unit sharply.
- ✗Mistake 1: Treating a one-time machinery purchase as a monthly fixed cost; capital expenses need amortising over their life.
- ✗Mistake 2: Ignoring the break-even when the variable cost is near the selling price — thin contributions mean huge sales targets.
Frequently Asked Questions
What does break-even mean for a business?
It is the sales level where total revenue exactly covers total costs — no profit, no loss. Every unit sold beyond the break-even point contributes directly to profit, which makes it a vital planning number for new ventures.
Which costs are fixed and which are variable?
Fixed costs stay constant regardless of sales — shop rent, salaries, insurance and licences. Variable costs change with output — raw materials, packaging, delivery and per-unit labour. Getting this split right is the hardest part of the analysis.
Can I find break-even for a service business?
Yes, treat a completed service as one unit. For example, a salon with ₹1,00,000 monthly fixed costs where each service contributes ₹200 towards them breaks even at 500 services a month.
What if my contribution margin is negative?
If the variable cost per unit is at or above the selling price, every sale loses money and no break-even point exists. The calculator returns no result — you must raise prices or cut variable costs first.
How often should I redo the break-even analysis?
Re-run it whenever costs or prices change — rent hikes, input price rises or festive discounts all move the number. Indian small businesses often recheck monthly because raw material prices fluctuate.
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