SellerKitBreak-even starts with contribution
Every order brings in revenue and creates variable costs. After paying for product, packaging, shipping, advertising and transaction fees, the contribution left can pay your fixed expenses. Break-even is the point at which total contribution equals those fixed expenses, leaving neither a profit nor a loss under the assumptions entered.
The break-even formula
Orders needed = monthly fixed costs ÷ contribution per order. Round the result up to a whole order. Revenue at break-even equals that number of orders multiplied by the entered selling price. If contribution is negative, more orders increase losses. With zero contribution and positive fixed expenses, no finite sales volume reaches break-even.
A worked monthly target
For the example $30 product, contribution per order is $10.93. With $500 monthly fixed costs, $500 ÷ $10.93 is about 45.75. You need 46 whole orders, producing $1,380 in revenue. Those orders contribute $502.78, which covers the entered $500 overhead by a small amount.
Keep fixed and variable expenses separate
Put rent, software subscriptions and recurring fixed expenses in monthly costs. Put expenses that repeat with each order in the unit cost fields. Do not count the same expense twice. This model assumes one product at a stable price. For several products with different margins, calculate a weighted average contribution based on a realistic sales mix.
Frequently asked questions
Why are orders rounded up?
A fraction of an order cannot cover the remaining expense. The target uses the next whole order.
Does this include monthly advertising?
Fixed monthly campaigns can go in fixed costs. Advertising that scales per order belongs in ad cost per order; avoid double counting.
Why is break-even not achievable?
If each order contributes zero or a loss while fixed costs remain, more sales cannot cover those costs.
Is this a forecast?
No. It assumes the entered selling price and costs remain constant and does not predict customer demand.