Monthly revenue you need to cover every fixed cost.
Inputs
Salaries + software + rent + retainers
COGS + shipping + processing + variable ads, as % of revenue
Results
Monthly Break-Even—
Annual Break-Even
—
Contribution Margin %
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$ Per Revenue $
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What revenue means at this cost structure
Monthly Revenue
Variable Costs
Contribution
Net Profit
vs Break-Even
About this calculator
Break-even revenue is the monthly revenue level where your business covers every cost — fixed and variable — without producing profit or loss. It is one of the three numbers every founder should know cold (alongside contribution margin and CAC payback period). Yet most ecommerce operators have never calculated it and have only a vague sense of how much they need to sell to keep the lights on.
The math is simple. Fixed costs (salaries, software, rent, agency retainers, anything that doesn't change with order volume) divided by your contribution margin percentage gives you the revenue needed to cover those fixed costs. Contribution margin is what's left of every revenue dollar after variable costs (COGS, shipping, payment processing, performance marketing tied to ROAS targets). If 35¢ of every revenue dollar is contribution, you need $50,000 ÷ 0.35 = $142,857 in revenue to cover $50,000 of fixed costs.
The interesting question this calculator surfaces is the leverage point. Above break-even, every additional dollar of revenue produces ~35¢ of profit (in the example above). Below break-even, every dollar gone is amplified into a loss because you still owe the fixed nut. This is why operating leverage matters — businesses with low fixed costs and high contribution margin scale profit faster than businesses with high fixed costs, even at the same gross margin.
If your break-even target feels unreachable, the answer is rarely "drive more revenue at any cost." The answer is almost always: cut fixed costs ruthlessly until break-even drops below current revenue, then grow margin discipline-first. Pair this calculator with the Cash Flow Runway tool to see how many months you have at the current burn, and the Contribution Margin Calculator to identify which products or channels are dragging your variable cost percentage up.
Frequently asked questions
How is break-even revenue calculated?
Break-Even Revenue = Fixed Costs ÷ (1 − Variable Cost %). If you have $50,000 in monthly fixed costs and your variable costs (COGS + shipping + processing + marketing as % of revenue) total 65%, your break-even is $50,000 ÷ 0.35 = $142,857 per month. Below that you lose money; above it, every dollar of revenue contributes 35¢ to profit.
What counts as a fixed cost vs variable cost?
Fixed costs do not change with order volume: salaries, software subscriptions, rent, insurance, agency retainers. Variable costs scale with revenue: COGS, shipping outbound, payment processing, fulfillment per order, and most ad spend. Be careful with marketing spend — if you pay an agency a fixed retainer it is fixed, but if it is performance-based ad spend it scales with revenue and is variable.
My ad spend is variable but I budget it as a fixed monthly amount. Which is it?
Treat it however matches reality. If you genuinely cap ad spend at $X regardless of revenue, treat it as fixed. If you scale ad spend up as revenue grows (which is how most healthy brands operate), treat it as variable — usually as a percentage of revenue tied to your target ROAS.
Why is my break-even point so much higher than my actual revenue?
Because your fixed cost base is too large for your stage, your contribution margin is too thin, or both. The fix is either: (1) cut fixed costs aggressively until break-even drops below current revenue, (2) increase contribution margin by raising prices or lowering variable costs, or (3) grow revenue fast enough to clear the higher break-even point. Most struggling brands try option 3 with the wrong unit economics, which compounds losses.
Should I include myself in fixed costs?
Yes, with a market-rate salary for your role. Many bootstrappers exclude founder salary and falsely claim profitability. If you cannot pay yourself a fair wage from current operations, you are subsidizing the business with your own labor — which is fine for a runway, but not real break-even.