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Franchise · Planning

Break-Even Sales

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Use break-even sales to find the revenue you must hit before fixed costs are covered, using your contribution margin as the share of each dollar left after variable costs.

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Fixed Costs / (Contribution Margin% / 100)

$15,000 of fixed costs at a 60% contribution margin needs $25,000 in sales to break even.

Check your inputs before you rely on the result — calculations are informational only and depend entirely on the numbers you enter. See our Terms.

Variables and units

  • Fixed Costs

    Total fixed costs for the period.

    currency

  • Contribution Margin

    Share of each sales dollar left after variable costs.

    percent

Common mistakes

  • Confusing contribution margin with profit margin.
  • Leaving rent or salaries out of fixed costs.

Step-by-step example

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$15,000 of fixed costs at a 60% contribution margin needs $25,000 in sales to break even.