Contribution Margin Calculator
Per-product contribution margin and break-even analysis.
Contribution margin = Price − Variable cost. It's the amount each unit contributes to covering fixed costs and profit. CM% = CM / Price. Break-even units = Fixed costs / CM per unit. This calculator helps you analyze product profitability and break-even by product.
Inputs
Results
Contribution margin: $45
CM %: 56.25%
Break-even units: 223
Insights
Formula
CM = Price - Variable cost CM% = CM / Price Break-even units = Fixed / CM
Input Definitions
What does each input mean?
- Price
- Selling price per unit. Revenue per unit before costs.
- Variable cost
- Cost per unit that varies with production—materials, direct labor, shipping, etc.
- Fixed costs to allocate
- Fixed costs (rent, salaries, overhead) that must be covered before profit. Used for break-even.
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Which Products or Services Are Actually Worth Selling?
Contribution margin is the revenue left after variable costs — the amount each unit sold contributes toward covering fixed costs and generating profit. It’s the foundation of product profitability analysis, and businesses that don’t track it often find themselves selling high volumes of low-margin products while ignoring the opportunities that would actually move their P&L. This calculator helps you compute it clearly.
Use this when you’re deciding which products to promote, when you want to understand how different revenue mixes affect overall profitability, or when you’re setting minimum pricing floors. A product with a low contribution margin isn’t necessarily worth eliminating — but it should be optimized, and this tool gives you the numbers to know what optimization is worth.