Chartered Financial Analyst with 15+ years experience in small business finance and luxury retail analysis.
Find your jewelry business’s breakeven point. Enter any three variables—Monthly Fixed Costs, Avg. Price per Piece, Variable Cost per Piece, or Breakeven Pieces Sold—to solve for the fourth.
Jewelry Business Breakeven Calculator
Jewelry Business Breakeven Formula
The breakeven formula for a jewelry business finds the total number of pieces (Q) you must sell each month for your total revenue to cover all fixed and variable costs.
Q = F / (P – V)
Solve for Monthly Fixed Costs (F):
F = Q * (P – V)
Solve for Avg. Price per Piece (P):
P = (F / Q) + V
Solve for Variable Cost per Piece (V):
V = P – (F / Q)
Variables Explained
- Monthly Fixed Costs (F): Your total, recurring monthly overhead. This includes studio/store rent, website fees (Shopify/Etsy), marketing, insurance, and tool depreciation.
- Avg. Price per Piece (P): Your average retail price for a single piece of jewelry.
- Variable Cost per Piece (V): The average cost directly tied to one piece. This is primarily the cost of materials (metals, gems), packaging, and transaction/listing fees.
- Breakeven Pieces Sold (Q): The total number of pieces you need to sell each month to reach $0 in profit.
Related Calculators
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What is a Jewelry Business Breakeven Point?
A **Jewelry Business Breakeven Point** is the exact number of pieces (Q) you must sell each month to cover all expenses. It’s the minimum sales volume required to pay for your fixed “overhead” costs (like your studio rent or website fees) and the variable “production” costs (like metals and gems) for each piece.
**Fixed Costs (F)** are your consistent monthly overhead, whether you sell 1 piece or 100. This includes your studio rent, website platform fees (e.g., Shopify), marketing budget, business insurance, and the cost of your tools (amortized over time).
**Variable Costs (V)** are the costs incurred *only* when you sell a piece. This is the direct cost of materials (silver, gold, gemstones, chain), packaging (boxes, bags), and transaction/listing fees (like Etsy fees or credit card processing fees).
The **Contribution Margin** (P – V) is the profit from a single piece that goes toward paying your fixed costs. If you sell a necklace for $150 (P) and your materials/fees (V) cost $50, your contribution margin is $100. This calculator finds how many $100 “profit chunks” you need to cover your total fixed costs.
How to Calculate Jewelry Breakeven (Example)
Let’s calculate the breakeven point for an online jewelry business.
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Identify Monthly Fixed Costs (F):
Your monthly Shopify plan ($100), marketing ads ($500), studio rent ($800), and insurance ($100) total $1,500.
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Identify Avg. Price per Piece (P):
You sell a mix of earrings and necklaces, and your average sale price is $80.
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Identify Variable Cost per Piece (V):
You calculate that the average piece costs $20 in metals/gems, $5 in packaging, and $5 in transaction fees, for a total of $30.
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Apply the Formula: Q = F / (P – V)
First, calculate the contribution margin per piece: $80 (P) – $30 (V) = $50.
Next, divide the fixed costs by this margin:
Q = $1,500 / $50 = 30 -
Conclusion:
You must sell 30 pieces of jewelry each month to cover all costs. The 31st piece you sell will be your first unit of profit.
Frequently Asked Questions (FAQ)
If you are the owner, it’s better to pay yourself a fixed monthly salary and include that in **Fixed Costs (F)**. This ensures your business can support you. If you pay an artisan an hourly wage *per piece*, then that wage is a **Variable Cost (V)**.
Use a weighted average based on your most recent material purchases. It’s important to update your (V) value frequently if your core material costs fluctuate, as this will directly impact your true breakeven point.
A large, one-time tool purchase is a capital expense. For this calculation, you should *amortize* it. For example, if a $1,200 tool will last 2 years (24 months), add $50 ($1,200 / 24) to your **Monthly Fixed Costs (F)**.
Enter your (F) (e.g., $1,500), your (V) for a new piece (e.g., $30), and a *target* number of sales (Q) you think you can make (e.g., 50). The calculator will solve for (P), telling you the *minimum price* (e.g., $60) you must charge to hit your goal.