Chartered Financial Analyst specializing in e-commerce and subscription business models.
Determine how many boxes your subscription business must sell each month to cover all costs. Enter any three variables—Monthly Fixed Costs, Price per Box, Variable Cost per Box, or Breakeven Subscribers—to solve for the fourth.
Subscription Box Breakeven Calculator
Subscription Box Breakeven Formula
The breakeven formula for a subscription box finds the number of subscribers (Q) it must have for total monthly revenue to equal all fixed and variable costs.
Q = F / (P – V)
Solve for Monthly Fixed Costs (F):
F = Q * (P – V)
Solve for Price per Box (P):
P = (F / Q) + V
Solve for Variable Cost per Box (V):
V = P – (F / Q)
Variables Explained
- Monthly Fixed Costs (F): Your total, recurring monthly overhead (e.g., e-commerce platform fees, warehouse rent, marketing budget, salaries).
- Price per Box (P): Your average revenue per box sold (what the customer pays you).
- Variable Cost per Box (V): The direct costs per box shipped (e.g., cost of products, the box itself, kitting labor, shipping, transaction fees).
- Breakeven Subscribers (Q): The total number of subscribers you need to reach $0 in monthly profit.
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What is a Subscription Box Breakeven Point?
A **Subscription Box Breakeven Point** is the number of monthly subscribers (or boxes sold) required to cover your total costs. This is the minimum sales volume needed to be profitable.
**Fixed Costs (F)** are your monthly “overhead.” These are the expenses you pay regardless of how many boxes you ship. This includes your e-commerce platform fees (e.g., Shopify, Cratejoy), warehouse or storage rent, salaries, and your fixed monthly marketing budget.
**Variable Costs (V)** are the costs tied *directly* to each box you send. This is the “Cost of Goods Sold” (COGS) for the products inside, the cost of the physical box and packing materials, kitting labor (if paid per-box), shipping/postage, and payment processor transaction fees.
The **Contribution Margin** (P – V) is the profit from a single box that goes toward paying off your large monthly fixed costs. This calculator finds how many subscribers are needed to cover your total overhead.
How to Calculate Subscription Box Breakeven (Example)
Let’s calculate the breakeven point for a new subscription box.
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Identify Monthly Fixed Costs (F):
The business has $5,000 in monthly platform, storage, and marketing costs.
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Identify Price per Box (P):
The box sells for $45 (including shipping).
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Identify Variable Cost (V):
Each box costs $20 in products, kitting, and shipping.
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Apply the Formula: Q = F / (P – V)
First, calculate the contribution margin per box: $45 (P) – $20 (V) = $25.
Next, divide the fixed costs by this margin:
Q = $5,000 / $25 = 200 -
Conclusion:
The business must have 200 subscribers each month to cover all costs and start making a profit.
Frequently Asked Questions (FAQ)
You must use a **weighted average** for your Price (P) and Variable Cost (V). You cannot just average the prices. Calculate (Total Revenue / Total Boxes) to find your true (P).
Shipping and postage are a classic **Variable Cost (V)** because you only pay them when you ship a box. Include this in your “Variable Cost per Box” field.
If you have a consistent monthly budget (e.g., “$1,000/mo on ads”), add it to your **Fixed Costs (F)**. If you are paying per-acquisition (e.g., “$10 per new subscriber”), you should add that to your **Variable Cost (V)** *for the first month’s calculation*.
This is the perfect tool for pricing. Set your (F) (e.g., $5,000), (V) (e.g., $20), and a realistic subscriber goal (Q) (e.g., 150). Solve for (P) to find your minimum price: `P = ($5,000 / 150) + $20 = $33.33 + $20 = $53.33`. You must charge at least $53.33 per box.