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Reseller break-even calculator

How many clients it takes to cover a month of fixed costs, rounded up, because clients come whole.

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Either the profit a client leaves you, or the two numbers it comes from.

What you owe in a month where you sell nothing at all.

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Result

4 clients at $120.00 covers $400.00 of fixed costs

$480.00 of profit against $400.00 of fixed costs, $80.00 over.

  • Info

    4 clients cover the month

    $400.00 ÷ $120.00 is 3.33, and clients come whole, so it rounds up to 4. Those 4 bring in $480.00 against $400.00 of fixed costs.

  • Info

    The last client overshoots the target

    $400.00 does not divide exactly by $120.00, and you cannot sign four-fifths of a client, so client number 4 takes the month past break-even rather than level with it: $480.00 against $400.00, which is $80.00 over.

  • Info

    This assumes every client is the same client

    The count divides the fixed costs by one profit figure, which treats client number twelve as worth exactly what client number one is worth. Real books are not like that: a couple of large accounts usually carry more than their share, so losing one moves the count further than its number suggests.

Break-even

Fixed costs
$400.00
Profit per client
$120.00
Clients needed
4
Profit at that count
$480.00
Surplus
$80.00

On the way there

ClientsProfitAfter fixed costs
2$240.00-$160.00
3$360.00-$40.00
4$480.00$80.00
5$600.00$200.00
6$720.00$320.00

The last column is negative until client 4 and positive after, which is the whole of what break-even means.

  • One profit figure, applied to every client equally. A book where the top two accounts bring in half the profit breaks even sooner than this count says, and a long tail of small accounts breaks even later.
  • There is no seasonality in here. A month where half your renewals land and a quiet month both get the same answer, because the only inputs are a fixed cost and a profit per client.
  • Nothing here knows how long a client stays. Covering the fixed costs this month and covering them next month are different questions once churn is in the picture - that is what the lifetime-value tool is for.
  • The fixed cost is exactly what was typed. A cost that is about to rise, or one still sitting on a card nobody has reconciled, is not in the count.

What this is

This reseller break even calculator answers one question in one division: with these fixed costs, and this much profit from each client, how many clients before the month pays for itself? The count rounds up, because there is no such thing as four-fifths of a client, and the table underneath shows the counts either side of it so the gap you are closing is visible rather than implied.

Break-even is the point where the profit your clients leave behind exactly covers the costs you owe whether or not they buy anything. Below it you are funding the business out of something else; above it each additional client is profit rather than a contribution towards a bill.

There are two ways to describe what a client is worth, and the tool takes either: the profit figure directly, if you already net it off, or the cost of serving one against what you charge one, in which case the profit is derived rather than typed - the same derivation the margin tools use.

A single sale’s margin says nothing about whether the month as a whole clears its fixed costs - for that, Pricing what you resell: cost, markup and margin (/blog/pricing-what-you-resell-cost-markup-and-margin) is the fuller guide, working through this break-even sum alongside seat planning, MRR/ARR and lifetime value.

How to read the result

The Clients needed row is the answer. The Surplus row next to it is how far the last client overshoots: unless the fixed costs divide exactly by the profit per client, the count that covers the bill also goes past it, and that overshoot is the first money you actually keep.

The table walks the counts around break-even with the third column showing what is left after fixed costs - negative on the rows above the answer, positive on the rows below it. The row where the sign flips is the row the headline names.

Common mistakes

What goes wrong most often, and how to tell.

  • Rounding the client count downA count of 3.4 clients does not mean three clients is close enough: three leaves the month short by the remaining four-tenths of a client’s profit. Break-even always rounds up, which is why this tool reports the surplus rather than pretending the division came out even.
  • Using revenue per client instead of profit per clientA client who pays $180 a month and costs $60 to serve contributes $120 towards the fixed costs, not $180. Dividing fixed costs by revenue understates the count by exactly the share of each invoice that goes straight back out to a supplier.
  • Leaving your own time out of the fixed costsIf the plan is for the business to pay you, your salary is a fixed cost like any other subscription, and a break-even count that leaves it out is the count at which the business survives while you work for nothing.
  • Reading break-even as a target to stay atBreak-even is the floor, not the goal: it is the point where a bad month costs you nothing rather than the point where the business is worth running. The useful number is usually how many clients past it you need for the margin you want.

Questions

What people ask about this tool.

  • Divide your monthly fixed costs by the profit one client leaves you each month, then round up to a whole client. At $400 of fixed costs and $120 of profit per client that is 3.33, so four clients - three would leave the month $40 short even though the division looks close.

  • Profit, every time. Revenue includes the money that leaves again as supplier cost, so dividing fixed costs by revenue per client gives a count that is too low and a month that is still behind when you reach it. Use what is left after the cost of serving that client.

  • Because a fraction of a client does not pay a fraction of your fixed costs - nobody signs 40% of a contract. The count that covers the bill is the first whole number at or above the division, and the amount by which that client takes you past the bill is shown as the surplus.

  • Only indirectly. It tells you how many clients the current price supports a month of costs with, and a count that feels out of reach is usually a pricing problem rather than a sales one - raising the profit per client moves the count down far faster than finding more clients moves it up.

Use it from the API

The same check, as one request.

Request
curl -X POST https://resellerhq.com/api/tools/breakeven-calculator \
  -H "Content-Type: application/json" \
  -d '{"basis":"profit","fixedCosts":400,"profitPerClient":120}'
Response
{
  "tool": "breakeven-calculator",
  "input": {
    "basis": "profit",
    "fixedCosts": 400,
    "profitPerClient": 120,
    "costPerClient": 60,
    "pricePerClient": 180
  },
  "result": {
    "verdict": {
      "tone": "success",
      "headline": "4 clients at $120.00 covers $400.00 of fixed costs",
      "summary": "$480.00 of profit against $400.00 of fixed costs, $80.00 over."
    },
    "findings": [
      {
        "id": "clients-needed",
        "severity": "info",
        "title": "4 clients cover the month",
        "detail": "$400.00 ÷ $120.00 is 3.33, and clients come whole, so it rounds up to 4. Those 4 bring in $480.00 against $400.00 of fixed costs."
      },
      {
        "id": "surplus-at-break-even",
        "severity": "info",
        "title": "The last client overshoots the target",
        "detail": "$400.00 does not divide exactly by $120.00, and you cannot sign four-fifths of a client, so client number 4 takes the month past break-even rather than level with it: $480.00 against $400.00, which is $80.00 over."
      },
      {
        "id": "constant-profit-assumed",
        "severity": "info",
        "title": "This assumes every client is the same client",
        "detail": "The count divides the fixed costs by one profit figure, which treats client number twelve as worth exactly what client number one is worth. Real books are not like that: a couple of large accounts usually carry more than their share, so losing one moves the count further than its number suggests."
      }
    ],
    "parts": [
      {
        "kind": "facts",
        "title": "Break-even",
        "rows": [
          [
            "Fixed costs",
            "$400.00"
          ],
          [
            "Profit per client",
            "$120.00"
          ],
          [
            "Clients needed",
            "4"
          ],
          [
            "Profit at that count",
            "$480.00"
          ],
          [
            "Surplus",
            "$80.00"
          ]
        ]
      },
      {
        "kind": "table",
        "title": "On the way there",
        "columns": [
          "Clients",
          "Profit",
          "After fixed costs"
        ],
        "rows": [
          [
            "2",
            "$240.00",
            "-$160.00"
          ],
          [
            "3",
            "$360.00",
            "-$40.00"
          ],
          [
            "4",
            "$480.00",
            "$80.00"
          ],
          [
            "5",
            "$600.00",
            "$200.00"
          ],
          [
            "6",
            "$720.00",
            "$320.00"
          ]
        ],
        "mono": [
          1,
          2
        ],
        "note": "The last column is negative until client 4 and positive after, which is the whole of what break-even means."
      }
    ],
    "limits": [
      "One profit figure, applied to every client equally. A book where the top two accounts bring in half the profit breaks even sooner than this count says, and a long tail of small accounts breaks even later.",
      "There is no seasonality in here. A month where half your renewals land and a quiet month both get the same answer, because the only inputs are a fixed cost and a profit per client.",
      "Nothing here knows how long a client stays. Covering the fixed costs this month and covering them next month are different questions once churn is in the picture - that is what the lifetime-value tool is for.",
      "The fixed cost is exactly what was typed. A cost that is about to rise, or one still sitting on a card nobody has reconciled, is not in the count."
    ]
  }
}

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