Know the target.
Plan the next move.
Estimate how many units you need to sell each month to cover fixed and variable costs. Adjust the figures to compare your options.
The sales you need
Enter your figures and select Calculate break-even.
- Contribution per unit
- R 0.00
- Whole units to cover costs
- 0
- Revenue at that sales volume
- R 0.00
Every sale makes
a contribution.
Contribution per unit is your selling price minus the variable cost of making or delivering one unit. Divide fixed monthly costs by this contribution to find the sales volume needed to cover costs.
The calculator rounds that volume up to a whole unit. Revenue at this volume is the rounded unit count multiplied by the selling price. If your price is equal to or below the variable cost, each sale cannot make a positive contribution towards fixed costs.
Use figures for one product or service and a consistent VAT basis. Fixed costs stay the same over the period being modelled; variable costs change with the number of units sold. This simple model assumes the price and cost per unit stay constant.
250 sales cover these costs.
- Fixed monthly costs
- R 10,000.00
- Price per unit
- R 100.00
- Variable cost per unit
- R 60.00
- Contribution: R 100 − R 60
- R 40.00
- Units: R 10,000 ÷ R 40
- 250
- Revenue: 250 × R 100
- R 25,000.00
At 250 units, R 25,000.00 revenue covers R 15,000.00 variable costs and R 10,000.00 fixed costs.
Turn the target into a working budget.
Plan costs, cash flow and sales with accounting support built around your business.