Useful next calculations
When to use this calculator
- Before pricing a job, setting margin targets or reviewing hiring costs.
- When you want to test sensitivity around volume, tax, markup or overheads.
- When you need a practical estimate before committing to a budget or proposal.
- When you are modelling break-even volume as costs or prices change.
A worked example
These are the example figures the calculator opens with.
| Input | Value |
|---|---|
| Fixed Costs (R) | R10 000 |
| Selling Price per Unit (R) | R50 |
| Variable Cost per Unit (R) | R20 |
For those figures the calculator returns:
- Break-even units: 334.00
- Revenue needed: R16 700,00
- Contribution margin: R30.00
Method & assumptions
The break-even point in units is calculated as: Fixed Costs ÷ (Selling Price per Unit − Variable Cost per Unit). The denominator — selling price minus variable cost — is known as the contribution margin per unit. To find break-even in revenue terms rather than units, divide total fixed costs by the contribution margin ratio (contribution margin per unit divided by selling price).
Enter all figures excluding VAT if your business is VAT-registered, as VAT is not part of your underlying economics. This calculator assumes a single product or a consistent product mix and does not account for step-fixed costs (where fixed costs jump at certain output levels). It is intended as a planning aid; for statutory financial reporting, use formal management accounts prepared with your accountant's guidance.
Common mistakes
- Using an assumption that is not supported by a current local quote, bill, statement or official source.
- Treating a generic estimate as a lender, provider, payroll or tax authority decision.
- Mixing monthly and annual inputs without converting them consistently.
- Testing only one scenario instead of checking how a cautious assumption changes the result.
What to do next
- Run a second scenario with a cautious assumption so you can see the downside clearly.
- Compare the result with the related calculators below before making a decision.
- Check current local rules, eligibility and provider terms before applying or committing money.
- Keep a record of the assumptions so you can update the estimate when a quote, bill or pay figure changes.