Find the exact sales volume at which revenue covers all fixed and variable costs. Enter fixed costs, variable cost per unit, and selling price per unit to see break-even units and break-even revenue.
The break-even point is the moment a business stops losing money and starts earning it. Below the break-even, every sale only partially covers fixed overhead and the business runs at a loss. Above the break-even, every additional sale flows mostly to profit. Knowing your break-even — in units and in revenue — is the difference between budgeting on instinct and budgeting on numbers.
The Xuvilo break-even calculator handles the standard contribution-margin model used by every business school: break-even units = fixed costs ÷ (price − variable cost per unit). Enter your monthly rent, salaries and other fixed overhead; your selling price per unit; and your variable cost per unit. The calculator returns the units you must sell each month to break even, the revenue that represents, and your contribution margin per unit and as a share of the price.
It works for any business that sells units: a Cairo bakery counting loaves, a Riyadh trader counting containers, a Dubai SaaS founder counting subscriptions, a Beirut consultant counting billable hours. The model is the same; only the unit changes. Run it monthly during start-up phase and quarterly thereafter.
Contribution Margin = Selling Price − Variable Cost per Unit
Contribution Ratio = Contribution Margin ÷ Selling Price × 100
Break-Even Units = Fixed Costs ÷ Contribution Margin
Break-Even Revenue = Break-Even Units × Selling Price
Fixed costs $10,000, variable cost $30 and price $50 per unit → contribution margin $20 (40% of the price) → break-even at 500 units, or $25,000 of revenue
Fixed costs remain the same regardless of production volume — rent, salaries, insurance, and equipment. Variable costs increase with every unit made — materials, direct labor, and packaging. Understanding the split is the starting point for any break-even analysis.
Contribution margin is the selling price of one unit minus its variable cost: what each sale contributes towards your fixed costs. Break-even units = fixed costs ÷ contribution margin, and every unit sold beyond that adds its contribution margin to profit. A higher contribution margin reaches break-even sooner. A negative one, where the price is below the variable cost, loses money on every unit, and the calculator will not compute a break-even for it.
Break-even units is the number of products you must sell. Break-even revenue is the total sales amount needed. Use units when you sell a single product type; use revenue when you sell a mix of products at different prices.
If your break-even point is 1,000 units and you can realistically sell only 600, you must raise the price (increasing contribution margin), cut fixed or variable costs, or accept a loss. Break-even forces pricing trade-offs into the open before you go to market.
It is how far your sales can fall before you reach break-even: (current sales − break-even sales) ÷ current sales × 100. Selling 650 units against a break-even of 500 gives a margin of safety of 23%. There is no fixed target, but the thinner it is, the more one weak month — a seasonal slowdown or a delayed project — can tip you into a loss.
Not if you are VAT-registered and can reclaim the VAT on your costs: VAT then passes through your accounts, so work with net selling prices and net costs. If you cannot reclaim it, the VAT you pay on costs is a real cost and belongs in your cost figures.
Use your sales mix. Work out the average selling price and the average variable cost per unit, each weighted by how many units of each product you sell, and enter those: the result is the break-even, in units and revenue, for that mix. If the mix changes, run it again.
Yes. Replace 'units' with service engagements (client hours, projects, retainers) and 'variable cost per unit' with the direct cost of delivering one engagement. Many consulting and agency businesses use break-even to set their minimum billable rate and validate their pricing model.
Once you know your break-even, send accurate quotes with the free Xuvilo quotation generator and bill customers cleanly with the free invoice generator. For more articles on running a profitable MENA business, visit the Xuvilo Blog.
Open the free Break-Even Point Calculator now, or browse the full business calculator suite.
