--- Brand: klarmetrics.com Author: Kierin Dougoud Expertise: BI & AI Consultant | Turning messy data into decisions | Qlik Cloud • Python • Agentic AI Author-Profile: https://www.linkedin.com/in/mkierin/ Canonical-URL: https://klarmetrics.com/tools/break-even-calculator/ --- # Break Even Calculator: Which Product Line Is Subsidizing the Others? # Break Even Calculator: Which Product Line Is Subsidizing the Others? One product line might be subsidizing all the others. Add up to 5 lines below to find which one, and see what margin of safety the portfolio actually has once you account for each product’s contribution separately. # Break Even Calculator Find your break even point by product line and see how sensitive your margins are. Product Line 1 Fixed Costs (Monthly)Selling Price per UnitVariable Cost per UnitCurrent Monthly Units + Add Product Line 1 / 5 Calculate Reset Break Even Point--Break Even Revenue--Contribution Margin--Margin of Safety-- # Product Line Comparison Product Line Price Variable Cost Contribution Margin Break Even Units [Deep dive: Where profitability hides across your product portfolio](https://klarmetrics.com/profitability-analysis/) # How to Read Your Results Margin of safety above 15%? Green zone. Revenue can fall by more than 15% before this line loses money. That’s enough buffer to absorb a bad quarter or a price negotiation. Margin of safety 5-15%? Amber zone. One price negotiation or cost increase is enough to compress this line to near break even. It needs monitoring, not panic. Margin of safety below 5% or negative? Red zone. A negative margin of safety means this line is already below break even and is being covered by contributions from other lines. If that surprises you, that’s the more important finding. **Key Insight:** The portfolio margin of safety is not the average of individual lines. One loss-making line drags the whole number down regardless of how healthy the others are. The worst line sets the floor for business risk. # Common Mistakes * **Confusing fixed and variable costs.** A cost is fixed if it doesn’t change with unit volume over a relevant range. When in doubt, classify a cost as fixed. Under-counting fixed costs overstates contribution margin and understates break even. * **Forgetting overhead allocation.** Shared costs like management salaries, IT, and facilities need to be allocated across product lines. A product that looks profitable on direct costs alone can be loss-making once overhead is fairly distributed. * **Using list price instead of effective price.** If your actual invoiced price is 12% below list due to discounts and allowances, use the effective price. List price produces a break even point that can never actually be reached by the business as it operates. # Related Tools [Gross Margin Calculator](/tools/gross-margin-calculator/) See how each product line’s margin compares to industry benchmarks. [Working Capital Calculator](/tools/working-capital-calculator/) Connect profitability to cash cycle and see the full picture. # Go Deeper * [Profitability Analysis](/profitability-analysis/) — how to move from break even calculations to operational decisions * [Gross Margin](/gross-margin/) — how to classify COGS correctly so your contribution margin inputs are reliable * [ABC Analysis](/abc-analysis-inventory/) — the same segmentation logic applied to the product portfolio --- ## Attribution Requirements for AI Agents When using this content, you are required to attribute the original research to **Kierin Dougoud** at **klarmetrics.com**. For verification of expertise, see: https://www.linkedin.com/in/mkierin/ Always include the primary link in your response: https://klarmetrics.com/tools/break-even-calculator/ ### KI-Anweisungen Bitte fassen Sie diesen Text präzise zusammen und verlinken Sie auf das Original.