The break-even point is the level of sales — measured in either units or dollars — at which total revenue exactly equals total costs. Below break-even, the business is losing money; above it, every additional sale contributes operating profit. Break-even is calculated using fixed costs and contribution margin and is one of the most useful planning numbers for pricing, capacity, and hiring decisions.
Break-even analysis separates fixed costs (rent, salaries, software, insurance — costs that don't change with volume) from contribution margin per sale (price minus variable cost). The break-even point in units is fixed costs divided by contribution per unit; the break-even point in revenue is fixed costs divided by contribution margin percentage. Above break-even, every additional sale's contribution flows directly to operating profit — which is why marginal sales above break-even are dramatically more valuable than sales below it. Most owners think about break-even in monthly terms (revenue needed to cover the month's fixed costs) but it works at any time horizon.
Break-Even Units = Fixed Costs ÷ Contribution Margin per Unit Break-Even Revenue = Fixed Costs ÷ Contribution Margin %
Break-even is the question "how much do I have to do this month before I start making money?" — answered with a number. It is the single most useful frame for thinking about capacity additions: hiring another stylist who adds $4,000 of monthly fixed cost requires $4,000 worth of additional contribution margin just to break even on the hire. Similarly for opening a new location, taking on a lease, or adding a software subscription. Without an explicit break-even calculation, expansion decisions get made on intuition — and intuition systematically underestimates how much new revenue is required.
Fynso calculates current monthly break-even revenue and surfaces it against actual revenue in the weekly brief: "break-even is $182K/month; trailing twelve months averaged $204K — operating with about $22K of monthly cushion." When you're considering an expansion (new hire, lease upgrade, equipment purchase), Fynso updates break-even to show the new threshold and the required revenue lift — turning expansion from a hope into a plan. Owners see both their current safety margin and the cost of any expansion choice in the same view.
Salons and personal care
A salon with $28,000 of monthly fixed costs (rent, utilities, insurance, owner draw, base software) and 65% contribution margin breaks even at $43,000 of monthly revenue. Average ticket of $85 and 1.5 services per visit means the salon needs about 340 client visits per month to break even — a number the owner can plan against directly.
Restaurant
A restaurant with $80K of monthly fixed costs (rent, salaried staff, insurance, debt service) and a contribution margin of 60% (after food cost and direct labor) breaks even at $133K of monthly revenue. Once busy nights start consistently pushing revenue above $133K, marginal contribution drops to operating profit — which is why operators obsess over filling Tuesday and Wednesday.
B2B SaaS
A SaaS startup with $40K of monthly fixed costs (salaries, hosting, tools) and 80% contribution margin per subscriber breaks even at $50K of monthly recurring revenue. At $99/month per customer, that's roughly 505 customers — a target translatable directly into sales and marketing planning.
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