Dropshipping Break Even Calculator
Know exactly when you start making profit
Cost Structure
Fixed Costs (Monthly)
Variable Costs (Per Unit)
Selling Price
Break-Even Analysis
Enter your costs to find break-even point
When To Use This Calculator
Before Launching
Know your numbers before spending a dollar. Calculate how many sales you need monthly to justify your Shopify subscription and app costs.
Setting Ad Budgets
Your break-even ROAS tells you when to scale or kill an ad. If your campaign hits 2.5x ROAS and break-even is 2x, you're profitable.
Pricing Decisions
See how a $5 price increase drops your break-even from 50 units to 35 units. Small pricing changes have big impacts.
Monthly Planning
Set realistic sales goals. If break-even is 100 units and you want $2000 profit, you know you need roughly 200 units.
Supplier Negotiation
Show suppliers how a $1 cost reduction lowers your break-even by 10 units. Use data to negotiate better rates.
Product Comparison
Compare break-even points across products. A $50 item might need fewer sales than a $20 item despite higher costs.
Frequently Asked Questions
What costs count as "fixed" in dropshipping?
Fixed costs stay the same regardless of sales volume: Shopify plan ($29-299), domain renewal (~$15/year), app subscriptions (Oberlo, email tools), virtual assistants on salary, and any monthly software. These costs exist even if you sell zero products.
Should I include ad spend in break-even calculation?
It depends. For basic break-even (covering fixed costs), exclude ads. For "true" profitability, include your average ad cost per order. The Break-Even ROAS tab handles this separately - it tells you the minimum ad performance needed.
What's a good contribution margin for dropshipping?
Aim for 40-60% contribution margin (selling price minus variable costs). Below 30% makes it hard to cover fixed costs and ads. Higher margins give you more room to spend on customer acquisition.
How often should I recalculate break-even?
Recalculate whenever costs change: new app subscription, supplier price change, shipping rate update, or new product launch. Monthly review is a good habit. Costs creep up over time.
My break-even seems too high. What can I do?
Three levers: (1) Raise prices - even $3-5 can significantly lower break-even. (2) Reduce variable costs - negotiate with suppliers, find cheaper shipping. (3) Cut fixed costs - cancel unused apps, downgrade plans you don't need.
What's the difference between break-even units and revenue?
Break-even units tells you HOW MANY products to sell. Break-even revenue tells you HOW MUCH money in sales. If you sell multiple products at different prices, revenue is more useful. For single-product stores, units is clearer.
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