A break-even analysis shows exactly how many units you need to sell — or how much revenue you need to generate — before your business stops losing money. This tool visualizes the break-even point with a clear Chart.js graph showing where total revenue crosses total costs.
Inputs
Rent, salaries, subscriptions
Materials, shipping, COGS
For margin of safety calc
Break-Even Chart
How to Use the Break-Even Chart Generator
Break-even analysis is a foundational tool for business planning. Whether you're pricing a new product, evaluating a cost-cutting decision, or pitching to investors, knowing your break-even point shows you understand your unit economics.
Step 1: Enter Your Fixed Costs
Fixed costs are monthly expenses that don't change regardless of how many units you sell. Common examples include rent ($2,000/month), staff salaries ($8,000/month), software subscriptions ($200/month), and insurance ($150/month). Total these up for a realistic monthly fixed cost figure.
Step 2: Enter Variable Cost per Unit
Variable cost is what it costs you to produce or deliver one unit. For a physical product, this includes materials, packaging, and shipping. For a service, it might be contractor fees per hour. For SaaS, it could be hosting costs per customer. This cost scales linearly with units sold.
Step 3: Enter Your Selling Price
Enter the price at which you sell each unit. The difference between selling price and variable cost is your contribution margin — the amount each sale contributes toward covering fixed costs. If your contribution margin is too low, your break-even point will be very high.
Reading the Break-Even Chart
The green line shows total revenue as units sold increases. The red line shows total costs (fixed + variable). Where they intersect is your break-even point. Below the intersection you're losing money; above it you're profitable. The dashed gray line represents fixed costs — it stays flat to show how fixed costs are spread over more units as volume increases, reducing your cost per unit.
Margin of Safety
The margin of safety shows how far your current sales are above break-even, expressed as a percentage. If you're selling 200 units/month and break-even is 167 units, your margin of safety is 20% — sales could drop 20% before you hit zero profit. A margin of safety above 20% is generally considered healthy for small businesses.
FAQ
What is a break-even analysis?
Break-even analysis determines the exact sales volume at which total revenues equal total costs — the point where you are neither making a profit nor a loss. Below the break-even point you lose money; above it you profit. It's a fundamental tool for pricing, budgeting, and business feasibility.
How is the break-even point calculated?
Break-even units = Fixed Costs ÷ (Selling Price − Variable Cost per Unit). The denominator is called the contribution margin — the amount each unit sale contributes to covering fixed costs. Break-even revenue = Break-even units × Selling Price.
Is this break-even calculator free?
Yes, completely free with no signup required. The chart generates instantly as you change inputs.
What is the margin of safety?
Margin of safety is how far your current sales volume is above the break-even point, expressed as a percentage. A 20% margin of safety means sales could drop 20% before you hit break-even. It measures how much cushion you have against a revenue decline.
What is the contribution margin?
Contribution margin = Selling Price − Variable Cost per Unit. It represents how much each unit sold contributes toward covering fixed costs and eventually generating profit. Higher contribution margin means you need fewer units to break even.
What are fixed vs variable costs?
Fixed costs are expenses that don't change with production volume — rent, salaries, insurance, software subscriptions. Variable costs change proportionally with units produced or sold — materials, packaging, shipping, transaction fees. The break-even formula requires these to be separated correctly.