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Break-even calculator

Your break-even point is fixed costs divided by what each sale contributes after its own cost. A unit selling at ₹500 that costs ₹300 to make contributes ₹200, so ₹1,75,000 of monthly fixed costs and EMI needs 875 units a month. Enter yours.

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Work out your break-even point

Work it out per unit if you sell one main product, or from your gross margin if you sell many items. Use monthly figures. The boxes open on an example.

Work it out

Per unit

From my gross margin

Fixed costs ₹ a month

Rent, salaries, power and other costs that do not change with sales.

Loan EMIs, optional ₹ a month

Added to fixed costs, because they are due whatever you sell.

Selling price ₹ a unit

Variable cost ₹ a unit

Material, packing, freight and anything else each unit costs.

Units you sell now, optional a month

Gross margin % of sales

Sales minus the cost of what you sold, as a share of sales.

Sales now, optional ₹ a month

Profit you want, optional ₹ a month

Break-even sales a month ₹4,37,500

These are the example figures. Change any box to use your own.

Fixed costs and EMIs a month: ₹1,75,000
Contribution a unit: ₹200
Break-even units a month: 875
Contribution margin: 40%
Sales for the profit you want: ₹4,37,500, 875 units
Profit at today's sales: ₹25,000
Margin of safety: 12.5%

Arithmetic on the figures you enter. It assumes prices and costs stay the same as sales change.

How it is calculated

The break-even formula

Each sale first pays for its own cost. What is left, the contribution, goes towards fixed costs. Break-even is where the contributions add up to the fixed costs.

Per unit

break-even units = fixed costs ÷ (price − variable cost)

Rounded up to a whole unit. Break-even sales are those units times the price.

From the gross margin

break-even sales = fixed costs ÷ margin %

For a shop selling many items, the gross margin stands in for the contribution on each rupee of sales. To reach a profit, add it to fixed costs before you divide.

Worked examples

Worked examples: a small factory and a kirana store

Two made-up businesses with round numbers, not real files.

Break-even worked for a factory and a kirana store
Step	Factory, per unit	Kirana store, by margin
Fixed costs plus EMI a month	₹1,50,000 + ₹25,000 = ₹1,75,000	₹60,000 + ₹10,000 = ₹70,000
Contribution	₹500 minus ₹300 = ₹200 a unit	15% of sales
Break-even	₹1,75,000 ÷ ₹200 = 875 units, or ₹4,37,500 of sales	₹70,000 ÷ 15% = ₹4,66,667 of sales
Today	1,000 units, a profit of ₹25,000	₹6,00,000 of sales, a profit of ₹20,000
Margin of safety	12.5%	22.2%

Without its ₹25,000 EMI, the factory would break even at 750 units. That gap is what the loan has to earn back each month.

Know the limits

Limits of this calculator

It assumes the price, the variable cost and the margin stay the same at every level of sales.
It works on one product, or on one average margin across many. A real product mix shifts the margin.
It counts the whole EMI as a cash cost. In your accounts only the interest part is an expense.
It ignores tax. To see whether profits cover loan payments, use the DSCR calculator.

Good to know

Questions and answers

Straight answers on the method, the sources and what the numbers do and do not mean.

How do you calculate the break-even point?

Divide fixed costs by the contribution each sale makes. Per unit, the contribution is the selling price minus the variable cost. In the example, fixed costs and the loan EMI come to ₹1,75,000 a month and each unit contributes ₹200, so the business breaks even at 875 units, or ₹4,37,500 of sales, a month.

What is the break-even formula for sales in rupees?

Break-even sales = fixed costs ÷ contribution margin ratio. For a shop that knows its gross margin rather than a cost per item, the ratio is that margin. A kirana store with ₹70,000 of monthly fixed costs and EMI and a 15% gross margin breaks even at about ₹4,66,667 of sales a month.

Should a loan EMI be counted as a fixed cost?

For cash planning, yes. The EMI has to be paid every month whatever you sell, so this calculator adds it to fixed costs. Strictly, only the interest part is an expense in the accounts, and the principal part repays the loan.

What is the margin of safety?

It is how far sales can fall before the business makes a loss, as a share of current sales. In the factory example, selling 1,000 units against a break-even of 875 gives a margin of safety of 12.5%.

How does a new loan change my break-even point?

A new loan adds its EMI to fixed costs, so the business must sell more each month to break even. Run the numbers with and without the new EMI before you borrow. The business loan EMI calculator gives you the EMI.

Does this calculator affect my CIBIL score?

No. It makes no credit enquiry and asks for no name, phone number or PAN. CIBIL is the credit bureau whose score and report lenders check. Like every page on this site, it uses the analytics described in our Privacy Policy and Cookie policy.

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Sources

How to read these figures

Capnix is not a lender. Rates, amounts and approvals are decided by lenders. Rates shown here are examples, not offers.

Break-even point and contribution margin: standard cost-accounting arithmetic.
The examples are made-up businesses with round numbers, not real files.

Last checked: 02-Oct-2026.

Break-even is your own number. Lenders read the whole file.

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