How MyBreakeven calculates your business target
Your selling price and the costs of delivering one sale determine its contribution. Monthly commitments determine how many sales you need. Available productive hours determine whether you can deliver them.
Define the inputs before dividing
- Selling price
- The revenue from one consistent job, appointment, order or client period. Keep the unit and tax treatment consistent.
- Direct costs per sale
- Materials, directly attributable labor, other variable delivery costs and the acquisition allowance you enter.
- Monthly commitments
- Operating overhead plus separately entered owner pay. Add target profit only when calculating a target beyond operating break-even. Do not count the same salary or expense in two fields.
Payment fees apply to the entered selling price. Include a flat per-transaction charge in another direct-cost field. Currency selection labels amounts; it does not convert exchange rates.
The core formulas
If contribution is zero or negative, this model cannot calculate a finite sales target that funds monthly commitments. Change the cost mix or price before interpreting required sales. An acquisition allowance per sale is a simplified average; repeat-client and new-client economics may need separate scenarios.
Reproduce this monthly example
Illustrative USD assumptions, not a customer result: price $100; materials $10; direct labor $8; other costs $2; acquisition allowance $0; payment fees 3%; overhead $2,500; owner pay $1,500; target profit $0.
| Step | Result |
|---|---|
| Fees: $100 × 3% | $3 |
| Contribution: $100 − $3 − $10 − $8 − $2 | $77 |
| Monthly target: $2,500 + $1,500 | $4,000 |
| Exact sales: $4,000 ÷ $77 | 51.948… |
| Required whole sales | 52 |
| Exact / practical revenue | $5,194.81 / $5,200 |
At 52 sales, contribution is $4,004. At 40 sales it is $3,080, leaving a $920 shortfall against these commitments. These figures exclude any cost you did not enter.
Check productive hours and customer demand
Hours per sale must be total worker-hours: two people working for two hours use four worker-hours. Weekly hours are per worker. Utilization reserves time for work outside delivery. Include editing, setup or travel consistently; do not subtract the same time twice.
Example: one worker × 30 weekly hours × 52/12 × 80% ÷ 2.6 worker-hours gives 40 sales per month. The target of 52 therefore exceeds capacity by 12 whole sales. At an assumed 25% inquiry-to-sale conversion, 52 sales need 208 inquiries. This is a planning assumption, not evidence those inquiries exist.
Why industry and small-tool results differ
The eight industry calculators share the monthly contribution and capacity model, with different input labels and example values. A focused tool may answer a different question. The cleaning contract tool, for example, averages weekly visits using 52/12 and subtracts modeled labor, supplies, travel and entered contract overhead from the contract fee. Its assumptions do not automatically add payment fees, owner pay or acquisition costs. Read each tool's own formula and limits before comparing results.
Discount tools compare contribution before and after a discount. Cash-runway tools use entered cash flows, not accounting profit. The job-cost worksheet compares one job before monthly overhead. Its contribution should not be labelled final business profit.
Precision, limits and review scope
Core engine version 1.3.1 uses decimal arithmetic at 40-digit precision before converting results for display. Currency normally displays two decimals. Required units round upward; capacity rounds downward. Near-zero positive contribution can produce a very large required volume; inspect the assumptions rather than treating that volume as a forecast.
The capacity indicator and planning score are formula-based summaries, not probabilities of success. Demand, booking patterns, inventory payment timing, debts, taxes, replacement equipment and seasonal peaks require separate consideration when not included in your inputs. Weekly averages do not represent every calendar month.
On October 10, 2026, the formulas on this page were compared with the core engine and the examples were recomputed. This is a calculation consistency check, not independent accounting certification. Report a formula or content error.
Reference and next step
The U.S. Small Business Administration startup-cost guide provides general context for identifying business costs. MyBreakeven's exact implementation is described above; the SBA has not endorsed this product.
Follow an interactive walkthrough, then use the free business calculator with your own costs.