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Free Excel break-even analysis template

For small business owners and anyone pricing a product who needs to know how many units they must sell each month to cover costs. Enter the selling price, variable costs per unit and monthly fixed costs; the template calculates the contribution margin, break-even units and revenue, the units needed for a profit target, your margin of safety, and a table of profit or loss at different volumes.

cellwise-break-even-analysis-template.xlsxExcel workbook · 4.9 KB · works in Excel, Google Sheets, Numbers and LibreOffice · no signup
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This is the template's sheet, calculated by the same engine as the Cellwise app. Change any number to see the formulas react before you download.

ABCDEF
1Break-even analysis
2Per-unit figuresMonthly fixed costs
3Selling price per unit48Rent3200
4Materials per unit14.5Salaries (fixed staff)9500
5Direct labor per unit6Insurance420
6Packaging and shipping per unit3.25Software and subscriptions310
7Payment fees (% of price)0.03Marketing (planned)1800
8Variable cost per unit25.19Loan payment650
9Contribution margin per unit22.81Utilities and phone380
10Contribution margin ratio0.47520833333Total fixed costs16260
11
12Break-even units per month713Result
13Break-even revenue34224Short of break-even by 13 units
14Target monthly profit5000
15Units for target profit933Table starts at (units)400
16Expected units this month700Table step (units)100
17Profit at expected units-293
18Margin of safety-0.018571428571
19
20Profit at different sales volumes

How the formulas work

Contribution margin per unit

B9=B3-B8

Price minus the variable cost of one unit: what each sale contributes toward fixed costs and then profit. Variable cost in B8 adds materials, labor and packaging and the payment fee, which is a percentage of the price (B3*B7). Here each $48 sale leaves $22.81.

Break-even units, rounded up

B12=IF(B9>0,ROUNDUP(E10/B9,0),0)

Fixed costs divided by the contribution margin. ROUNDUP matters: $16,260 / $22.81 is 712.8, and selling 712 units still leaves a small loss, so the answer is 713. The IF returns 0 when the price does not cover variable cost, because then no volume breaks even.

Units needed for a profit target

B15=IF(B9>0,ROUNDUP((E10+B14)/B9,0),0)

Treat the profit you want as one more fixed cost and divide by the contribution margin. To make $5,000 a month this business needs 933 units, a third more than it expects to sell, which tells you to raise the price, cut a cost or lower the target.

Margin of safety

B18=IF(B16>0,(B16-B12)/B16,0)

How far expected sales can fall before you make a loss, as a share of expected sales. A negative number means you are already below break-even: at 700 units the sample is 13 units short, and D13 says so in words.

Profit at each volume

E22=B22-C22-D22

Revenue minus variable costs minus fixed costs, for each row of units. Change the first row and the step in E15 and E16 to zoom in around break-even, and select A21:A31 with E21:E31 and use Insert > Line chart for a break-even chart.

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FAQ

What is the break-even formula in Excel?

Break-even units = fixed costs / (price per unit - variable cost per unit). In Excel: =ROUNDUP(fixed/(price-variable),0). Break-even revenue is those units times the price, or fixed costs divided by the contribution margin ratio.

What is the contribution margin ratio?

The share of each sales dollar left after variable costs: contribution margin per unit divided by price. At 47.5%, every $100 of sales contributes $47.52 toward fixed costs and profit.

Should loan payments count as fixed costs?

For a cash break-even, yes, because the payment has to be made every month. For an accounting break-even, only the interest is an expense. Pick one approach and say which on the sheet.

Functions used

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