With the illustrative inputs below, the result is 60 sales.
Try this with your own numbersFormula and worked example
Required volume = ceiling((fixed costs + target profit) / unit contribution)
| Input | Example |
|---|---|
| Period fixed costs | 8,000 |
| Target operating profit | 4,000 |
| Revenue per order | 500 |
| Variable cost per order | 300 |
| Calculated result | 60 sales |
Choose reliable inputs
Track purchased quantities, usable yield, labour and waste before deciding on a selling price. For this bakery calculation, use recipe sheets, supplier invoices and stock counts and a consistent definition of one order.
- Ingredients: include the portion belonging to this order or reporting period, and record where the value came from.
- Preparation: include the portion belonging to this order or reporting period, and record where the value came from.
- Packaging: include the portion belonging to this order or reporting period, and record where the value came from.
Use the same currency for every money input. Do not mix weekly costs with monthly revenue, or count the same expense in both an itemised cost and allocated overhead.
How many sales are needed beyond break-even?
The unit contribution must be positive. Check whether delivery capacity can support the resulting volume.
What if this input changes?
If period fixed costs rises by 10%, this example changes by 4 sales. This shows the effect of one change; it does not predict what will happen.
Open the calculator, save your baseline, then change the input supported by the least reliable estimate in your records. Compare both scenarios before committing to a price or capacity promise.