Break-even is fixed costs divided by contribution margin: the price of one unit minus what it costs you to deliver it. Everything above that line is margin; everything below it is subsidized by your savings.
Why the margin line matters more than the units
Two businesses with identical fixed costs can have wildly different break-evens: one selling $149 units with $62 of variable cost needs 322 units a month; one selling $149 units with $130 of cost needs 2,154. The margin, not the price, decides whether the model works.
Frequently asked questions
What counts as a fixed cost?
Anything you pay whether or not you sell a unit this month: rent, salaries, software, insurance. Variable costs move with each sale — materials, payment processing, delivery.
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