Break-Even Point Calculator

About This Tool

The break-even point (BEP) is the revenue level at which total costs equal total revenue — meaning no profit and no loss. It answers the question "How much do I need to sell to stop losing money?" and is essential for business planning, pricing decisions, and financial analysis.

Formulas

• Variable Cost Ratio Mode: BEP Revenue = Fixed Costs ÷ (1 − Variable Cost Ratio)
• Unit Price Mode: BEP Units = Fixed Costs ÷ (Selling Price − Variable Cost per Unit)
• Margin of Safety: (Current Revenue − BEP) ÷ Current Revenue × 100 — higher is better

Key Terms

• Fixed Costs: Expenses that remain constant regardless of sales volume (rent, salaries, insurance, etc.)
• Variable Costs: Expenses that change proportionally with sales (materials, commissions, shipping, payment processing fees, etc.)
• Variable Cost Ratio: Variable costs as a percentage of revenue (e.g., if 60% of revenue goes to variable costs, the ratio is 60%)

Example

A retail store with ¥1,000,000 monthly fixed costs and a 60% variable cost ratio:
→ BEP Revenue = ¥1,000,000 ÷ (1 − 0.6) = ¥2,500,000
Sales of ¥2,500,000/month means breaking even. Above that is profit; below is loss.

Note: This tool is designed for monthly estimates. For annual calculations, enter your annual fixed costs.