Free Break-Even Analysis Calculator
A break-even analysis lets you determine how many units/sales you need to sell each month or annually to cover your costs of doing business.
The break-even analysis calculates the point where your fixed costs, variable costs per unit, and revenue per unit meet.
Calculating your business’s break-even point
Calculating your break-even point is vital for any business. It allows you to fully understand what your businesses obligations are, for the minimum number of sales to remain afloat.
One of the reasons why knowing your break-even point is so vital is that it forces business owners to take a good look at all of the costs and expenses for the entire operation, and it also makes entrepreneurs think about their pricing strategy. Both of these are very important, especially when you’re starting out in business, as you may not have thought about all the costs involved in producing your product or service.
Our break-even calculator is a tool that works great alongside your marketing plan. You may want to have sales targets of X% more than your BE point each month, so you know that your cash flow will be fine.
How to use the break-even calculator
The break-even calculator is super simple to use. Simply input your figures indicated by the red boxes in the example below.
- Firstly, add the price which you plan to sell your product.
- Then, add what the cost is to make one unit (variable cost).
- The calculator will automatically give you a gross profit margin for each product sold.
- Now, enter your fixed costs. This will include things like rent, utilities, other fixed monthly payments, etc.
After you have entered this figure, the calculator will give you two results.
- The dollar amount you need to receive, in order to break-even.
- The number of units you will need to sell, in order to break-even.
This free business tool works great when developing a business after it has been fully evaluated using Strategy State’s Business Evaluation Tool.
Click below to download your free business tool: