Lesson 3 of 5
Break-even Point
How many units you must sell before a product, an ad campaign, or a whole shop stops losing money.
~7 min
Break-even is the unit count at which total revenue equals total cost. Below it, every sale loses money. Above it, every sale is pure profit on the variable side.
Break-even units
Break-even units = Fixed costs ÷ (Price − Variable cost per unit)
A worked example
Fixed costs: $300 (Shopify plan + design tools). Price per shirt: $25. Variable cost per shirt (POD + fees): $15. Break-even = 300 ÷ (25 − 15) = 30 shirts. Sell 30 shirts and you cover the month. Sell 31 and you make $10.
Key takeaways
- Break-even = fixed costs ÷ contribution margin per unit.
- If break-even feels unreachable, raise price or cut cost before launching.
Related Guides
- Profit guideBusiness PlanningHow To Calculate Handmade Business Profit
Work out what your handmade business actually keeps after materials, labor, packaging, shipping, fees, and taxes.
- Profit guideBusiness PlanningWhat Is A Good Print-on-Demand Profit Margin? Complete POD Profit Margin Guide (2026)
What a good POD profit margin looks like in 2026 — gross vs net margin, every POD cost, formulas, worked t-shirt/hoodie/mug/poster/tote examples, pricing tables, and common mistakes.
- Profit guideBusiness PlanningWhat Is a Good Profit Margin?
What counts as a healthy profit margin — and how it changes depending on what you sell and where.
Related Calculators
- CalculatorPrint-on-DemandProfit Margin CalculatorUniversal profit, margin, and markup for any product or channel.Open calculator →
- CalculatorBreak-Even CalculatorSales needed to cover your startup costs.Open calculator →
- CalculatorProfit Margin Difference CalculatorCompare two prices or products by profit and margin.Open calculator →
Help Me Decide
Troubleshooting
Recommended Downloads
- ResourceWorkbookSeller Profit WorkbookTrack revenue, expenses, fees, profit margins, break-even points, and product performance across any online selling business.Open resource →
- ResourceWorksheetTikTok Shop Profit WorksheetA beginner-friendly worksheet for estimating TikTok Shop fees, costs, and profit per product — plus monthly sales targets and break-even checks.Open resource →
- ResourceWorksheetBreak-Even Planning WorksheetCalculate break-even points, profit cushions, and sales targets across any selling platform.Open resource →
Continue Learning
- Courseuniversal-sellerReturns & Refunds for SellersWhat a return actually costs, which resolution to choose, and when returns become a profit problemOpen course →
- CourseShopifyYour Own Online StoreA channel decision made on your numbers, and a store built to launchOpen course →
- CoursehandmadeHandmade & Craft FairsOne product priced from real costs, and one event planned as a business decisionOpen course →