Break-Even Price Calculator
Find the price you need to sell at to cover your costs.
Break-Even Price per Unit
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Finding Your Break-Even Point
One of the most fundamental calculations for any business is the break-even point. This is the level of production at which the costs of production equal the revenues for a product. In other words, it's the point where you are not making a profit, but you are also not incurring a loss. This calculator helps you determine the minimum price you must charge per unit to cover all your fixed and variable costs, providing a crucial baseline for your pricing strategy.
Frequently Asked Questions (FAQ)
What is the break-even point?
The break-even point is the point at which total costs and total revenue are equal, meaning there is no net loss or gain. Your business is 'breaking even.' Any revenue above this point is profit.
How is the break-even price calculated?
The break-even price per unit is calculated by dividing the total costs (both fixed and variable) by the number of units you plan to sell. The formula is: (Total Fixed Costs + (Variable Cost Per Unit × Number of Units)) / Number of Units.
What are fixed vs. variable costs?
Fixed costs are expenses that do not change regardless of the number of goods produced, such as rent, salaries, and insurance. Variable costs are expenses that change in proportion to production output, such as raw materials and direct labor.
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