Ecommerce Breakeven Calculator
Work out how many units you must sell to cover fixed costs given the selling price and the variable cost per unit.
Recent
Formula
How the calculation works
The calculator subtracts the variable cost per unit from the selling price to get the contribution margin.
It then divides the total fixed costs by that contribution margin to find the breakeven number of units.
For example, a 500 contribution against 100,000 of fixed costs means 200 units must be sold.
Common mistakes
- Using total costs instead of fixed costs, which mixes in variable costs that are already handled through the contribution margin.
- Setting a price below the variable cost per unit, so the contribution margin is negative and no number of sales ever breaks even.
When to use it
- Use it before launching a product to see how many orders are needed just to cover your fixed costs.
- Use it to test whether a planned price cut still leaves enough contribution to reach breakeven quickly.
Worked example
With fixed costs of 100,000, a price of 1200 and a variable cost of 700, the contribution per unit is 500, so you break even at 200 units.
Common questions
What counts as a fixed cost in ecommerce?
Fixed costs are expenses that do not change with order volume, such as website fees, storage rent and a monthly marketing budget.
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