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Work out the exact units and revenue your business must sell to cover fixed plus variable costs — useful for product pricing, startup viability checks, and contribution margin analysis.
Financial
Generated on May 23, 2026
Work out the exact units and revenue your business must sell to cover fixed plus variable costs — useful for product pricing, startup viability checks, and contribution margin analysis.
A break-even calculator tells you how many units you must sell — and at what total revenue — to cover all your fixed and variable costs. The break-even point is where profit is exactly zero. Selling any more than this generates profit; any less generates losses.
Formula
Break-even Units = Fixed Costs ÷ (Price per Unit − Variable Cost per Unit). Revenue = Units × Price.You're about to sign a 12-month lease for a small boutique in Tariq Road, hire two staff at PKR 35,000 each, and stock PKR 800,000 of lawn fabric inventory — and somebody at a family dinner asks you the only question that actually matters: "how many pieces do you need to sell every month to not lose money?" If you can't answer that to within 10 percent precision, you're flying blind, and the boutique will quietly bleed cash for 6 months before you realise the model never worked. Break-even analysis is the math that converts a vague "I want to start a business" into a concrete monthly sales target — the units (or revenue) you must sell to cover your fixed costs (rent, salaries, insurance, utilities) AND your variable costs (cost of goods sold per piece, packaging, shipping per order, payment gateway fees of 1-3 percent). The denominator is your contribution margin per unit: selling price minus variable cost. Higher contribution margin = fewer units needed = lower business risk. Pakistani small businesses fail disproportionately because nobody runs these numbers before signing the lease — they assume "the shop will figure itself out". Honest take: any new business in Pakistan that can't realistically hit break-even within 6 months of launch is structurally fragile, and any model with break-even at over 80 percent of theoretical maximum capacity (like restaurants needing 80 percent table occupancy or airlines needing 80 percent load factor) has very little room for bad weeks. Build a 30 percent buffer above break-even into your sales target.
A break-even calculator tells you how many units you must sell — and at what total revenue — to cover all your fixed and variable costs. The break-even point is where profit is exactly zero. Selling any more than this generates profit; any less generates losses. It is essential for business planning, pricing decisions, evaluating the viability of a new product or venture, judging whether a startup is defensible, and deciding when to scale or shut down a product line. Every entrepreneur and product manager should understand their break-even number before committing capital.
The denominator (Price − Variable Cost) is the 'Contribution Margin' — the dollars each sale contributes toward covering fixed costs.
Restaurants typically hit break-even around 70–80% seat occupancy — which is why empty weeknight tables hurt so much.
SaaS businesses have near-zero variable cost per user, making their break-even entirely about fixed costs (salaries, infra).
Manufacturers with heavy machinery have very high fixed costs — their break-even volumes are correspondingly large.
Airlines break even at roughly 70–80% load factor — explaining why empty seats = losses and last-minute price drops.
Fixed PKR 500,000, variable PKR 150/unit, price PKR 500 → break-even at 1,429 units (≈ PKR 714,500 revenue).
Fixed $20k, variable $5, price $25 → break-even at 1,000 units.
Restaurant: $30,000 monthly overhead, $8 food cost, $25 meal price → 1,765 meals/month to break even.
SaaS startup: $50k fixed, $2 server cost per user, $10/month subscription → 6,250 active subscribers to break even.
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