Break-Even & CAC Payback Calculator

Price minus the variable cost of delivering one unit — what each sale contributes toward fixed costs before any profit exists. It leads because it sets the whole calculation: break-even is fixed costs divided by contribution margin, so a thin contribution margin means the break-even point moves a long way for a small change in price.

Fixed is what you pay whether or not you sell anything this month — rent, salaried staff, software, insurance. Variable is what scales with each engagement: contractor hours, media pass-through, per-project licences. Salaried delivery staff are the awkward case. Treat them as fixed if you keep them regardless of workload, which for most agencies is the truth.

Under twelve months is healthy and under six is best in class, per the OpenView and Bessemer benchmarks. For an agency on monthly retainers the number matters more than it does for software, because you are usually paying commission and delivery costs up front against revenue that arrives a month at a time.

Possibly, but check the other end first. Long payback is more often a discovery and onboarding problem than a pricing one. Better-qualified customers expand faster, churn less and start paying back sooner — the same price to a better-fit buyer produces a shorter payback. Price is the blunt lever; fit is the sharp one.

It should. If the business has to pay you to keep operating, your salary is a fixed cost, and a break-even calculated without it will tell you that you are fine in a month you cannot actually afford. Founders leaving themselves out of this number is the most common error in the whole tool.

Yes — set fixed costs to the costs allocated to that project and it works exactly the same way. It is a useful check before you take on a large engagement at a discount, because it shows how many of them you would need at that price to still cover the overhead.