The exact moment your revenue covers every dollar of cost. Below it, you're losing money. Above it, you're making it.
Break-even point is the level of revenue at which your total costs — both fixed and variable — are exactly covered by your income. At break-even, you're not making money, but you're not losing it either. It's the financial zero line.
You can express it in dollars (revenue needed) or in units (number of sales needed). Most business owners care about the revenue version: “How much do we need to bill this month just to keep the lights on?”
Every business has a monthly nut — the minimum revenue required to avoid burning cash. If you don't know that number, you're guessing at whether you can afford that next hire, that marketing campaign, or that office upgrade.
Break-even also changes as your business evolves. Add a team member, and your fixed costs rise. Negotiate a better supplier rate, and your variable costs drop. Both shift the break-even point. Founders who track it monthly catch problems early — like when a “small” rent increase pushes your break-even up by $15K/month.
It's also the foundation of pricing decisions. If your contribution margin per unit is $50 and your fixed costs are $100K/month, you need 2,000 units just to break even. Knowing that number lets you set realistic sales targets.
Break-Even Point (Revenue) = Fixed Costs / Contribution Margin Ratio
Break-Even Point (Units) = Fixed Costs / (Price per Unit - Variable Cost per Unit)
Example: Your agency has $80K/month in fixed costs (salaries, rent, software). Your average project is $20K with $8K in variable costs (contractors, tools). Your contribution margin per project is $12K. Break-even = $80K / $12K = roughly 7 projects per month. Anything above 7 is profit.
CentSight calculates your break-even point automatically by pulling fixed costs and variable costs from your connected accounts. It updates as your expenses change, so you always know your current threshold — not last quarter's. You can ask “What's my break-even this month?” and get a real-time answer based on actual spending, not a spreadsheet you forgot to update.
CentSight tracks your fixed and variable costs in real time so your break-even point is always current.
Join the Waitlist