How much do you really need to sell?
Most contractors aren't "unprofitable"—they're just under-selling. If your overhead is $150k and you think a $500k year is a win, you might be surprised to find you're barely breaking even.
Break-Even Calculator
You must generate $333,333 in sales every year just to cover your costs and earn $0 in profit.
Worked examples: revenue needed to break even
How much work you must sell in a year just to cover overhead. Note the middle three rows: the same $100,000 of overhead needs $333k of revenue at a 30% margin but only $286k at 35%.
| Scenario | Annual overhead | Gross margin | Break-even revenue | Per month |
|---|---|---|---|---|
| $60k overhead at 25% margin | $60,000 | 25% | $240,000 | $20,000 |
| $100k overhead at 25% margin | $100,000 | 25% | $400,000 | $33,333 |
| $100k overhead at 30% margin | $100,000 | 30% | $333,333 | $27,778 |
| $100k overhead at 35% margin | $100,000 | 35% | $285,714 | $23,810 |
| $250k overhead at 30% margin | $250,000 | 30% | $833,333 | $69,444 |
Break-even covers overhead only — it is the point at which you stop losing money, not the point at which you earn a wage. Add owner compensation and target profit on top.
The "Why" Behind the Math
The break-even point is the revenue level where your total sales minus your direct costs (Materials + Labor) exactly equals your fixed costs (Overhead).
Step 1: Know Your Burn Rate
Your overhead (fixed costs) includes everything you pay even if you don't have a single project scheduled: Office rent, truck payments, insurance premiums, and non-billable staff salaries.
Step 2: Track Your Margin
Your average gross margin determines how much "fuel" each sale generates to pay for the overhead. A 30% margin means every $1.00 in sales provides $0.30 to pay the bills.
How to Lower Your Break-Even Point
- Increase your margin: A 5% boost in margin can lower your required revenue by six figures in some cases.
- Cut fixed overhead: Every $1,000 you cut from annual overhead is $3,333 less you have to sell (at a 30% margin).
- Automate with RemodelFin: Reduce the administrative "overhead" time and get more billable hours from your team.
Stop losing money to uncaught cost overruns.
Track labor burden, collect mobile change order signatures, and see your live profit margin on every job — starting today.
No credit card required · Setup in 10 mins