A factory has quoted a minimum order quantity and a sampling/pattern setup fee for a new style — before committing, you want to know exactly how many units need to sell before the run turns a profit.
Break-Even Units Calculator
Costing & Pricing
Contribution margin = Price − Variable cost
Break-even units = Fixed costs ÷ Contribution margin
Fixed costs (pattern-making, sampling, grading, setup fees) are spread across units until their total is covered — every unit sold after that point contributes toward profit.
Reference: Standard break-even analysis, applied to a single production run
Estimate only for business planning purposes. Verify against your actual costs, supplier quotes and local regulations before pricing or committing to a production run.
1 What this calculator does
Calculates the number of units that must be sold to cover the fixed, one-off costs of a production run (pattern-making, sampling, grading, factory setup fees) before any profit is made. Helps decide whether a minimum order quantity is realistic to sell through.
2 Formula & professional reasoning
Contribution margin per unit = Selling price - Variable cost per unit
Break-even units = Fixed costs / Contribution margin per unit
A production run has two cost types: fixed costs that don't change regardless of quantity (pattern development, sample garments, factory setup fees), and variable costs that scale with each unit (fabric, trim, per-unit labour). Every unit sold contributes its 'contribution margin' (price minus variable cost) toward covering the fixed costs first; once enough units are sold to cover fixed costs, every further unit is profit. This is the standard way to judge whether a minimum order quantity from a factory is actually sellable at a profit within a reasonable timeframe.
3 Worked examples
⚠️ Illustrative example only — not clinical or professional instruction.
Basic
Small local production run
Given: Fixed costs $600 (pattern + sampling), price $40, variable cost $18
Working:
Contribution = 40-18 = $22 | Units = 600/22 = 27.3 -> 28Answer: 28 units to break even
💡 A minimum order quantity above roughly 28-35 units (allowing some buffer) would need genuine sell-through confidence.
Standard
Factory MOQ with setup fee
Given: Fixed costs $1,200 (grading, setup, factory sampling), price $45, variable cost $22
Working:
Contribution = 45-22 = $23 | Units = 1200/23 = 52.2 -> 53Answer: 53 units to break even
💡 If the factory's minimum order quantity is 100 units, roughly half the run needs to sell before the business turns a profit on it.
Advanced
Complex garment, higher fixed cost
Given: Fixed costs $2,800 (multiple sample rounds, custom trims setup), price $120, variable cost $58
Working:
Contribution = 120-58 = $62 | Units = 2800/62 = 45.2 -> 46Answer: 46 units to break even
💡 Higher price points can offset high fixed costs with fewer units — worth comparing against a simpler design with lower fixed costs but a lower price point.
4 Sanity check
Compare to minimum order quantity (MOQ)
If break-even units are close to or above the factory's MOQ, the run carries meaningful sell-through risk
A healthy buffer is break-even at 50-70% of MOQ, leaving room for slower-than-expected sales
Contribution margin sanity check
Contribution margin should generally be at least 30-50% of the selling price for a sustainable apparel business
A very thin contribution margin means break-even units will be high relative to any production run size
Realistic sell-through timeframe
Break-even units should be achievable within a reasonable selling season, not just eventually — factor in how fast this product category typically sells
Sensitivity to price changes
Small changes in selling price can meaningfully shift break-even units since it directly changes contribution margin — worth testing a few price points
5 Common errors
| Error | Cause | Consequence | Fix |
|---|---|---|---|
| Omitting sampling and development costs from fixed costs | Only counting the production run's direct factory invoice as the fixed cost, forgetting pattern-making, sample rounds and grading fees | Understates true fixed costs and makes the break-even point look easier to reach than it is | Include all one-off costs specific to bringing this style to production — pattern development, sample garments, grading, factory setup fees |
| Using average variable cost across very different sizes | Applying a single variable cost figure when fabric usage differs significantly across a size range (e.g. XS vs 3XL) | Break-even estimate is less accurate for size-diverse production runs | Use a weighted average variable cost based on expected size distribution, or run the calculation for the most common size as a reasonable approximation |
| Ignoring the platform/channel selling cost | Calculating break-even on gross selling price without accounting for marketplace fees, payment processing or wholesale margins that reduce the effective per-unit revenue | Break-even point is optimistic — real units needed will be higher once channel costs are factored in | Use net revenue per unit (after marketplace fees or wholesale discount) as the 'selling price' input for a more realistic break-even figure |
| Treating break-even as the target rather than the floor | Planning a production run assuming break-even sales is 'success' | Break-even means zero profit — the business hasn't actually made money at that point, just covered its costs | Set a realistic sales target meaningfully above break-even units to ensure the run is actually profitable, not just cost-neutral |
6 Reference & regulatory links
7 Professional workflow
Common tools used alongside this one:
Garment Costing Calculator
Get an accurate variable cost per unit before running this break-even calculation
→
Wholesale/Retail Markup (Keystone) Calculator
Test different selling prices here to see how they shift the break-even unit count
→
Sell-Through Rate & Inventory Turn Calculator
Once the run is selling, track actual sell-through against your break-even target
→