Your break-even point is the number of sales that covers all your fixed costs. Divide monthly fixed costs by the profit on each unit (price minus cost per unit). With ₦650,000 fixed costs and ₦1,400 profit per unit, you need 465 sales a month, about 18 a day. Enter your figures below.
How the Break-Even Calculator works
- Enter fixed costs per month: rent, salaries, data, generator servicing, loan repayments.
- Enter your selling price and the cost of each unit.
- Enter how many days you open.
- See the units and sales needed per month and per day.
Worked example
A small eatery has fixed costs of ₦650,000 a month. A plate sells for ₦3,500 and costs ₦2,100 to make.
Profit per plate: ₦1,400
Break-even: ₦650,000 ÷ ₦1,400 = 465 plates a month
That is about 18 plates a day over 26 days (₦1,627,500 in sales)
Common mistakes to avoid
- Leaving loan repayments and generator costs out of fixed costs
- Using average price when products have very different margins
- Treating break-even as a target instead of the minimum
Need a different calculator?
Using break-even to decide
Before you take a bigger shop, hire staff or buy equipment, add the new monthly cost to fixed costs and see the new break-even. If the daily number looks impossible for your location, rethink the plan.
Lowering your break-even
You can raise your price, cut the cost per unit (better suppliers, less waste) or cut fixed costs. Small changes to the profit per unit often move break-even the most.
Frequently asked questions
What is the break-even formula?
Break-even units = fixed costs ÷ (price − cost per unit).
What are fixed costs?
Costs that stay the same whatever you sell, such as rent, salaries and subscriptions.
What if my price is below my cost?
You can never break even. Raise the price or cut the cost per unit.
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