Break-even & cash
Promotion Break-Even Calculator
This night costs me money up front. How many people does it need?
A promotion earns back its cost through the margin on incremental guests, not through the headcount. Enter what the night costs you and what a guest is worth after variable costs.
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Worked answer113See it ↓01
Your numbers
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02
The answer
Guests needed to break even
113
at $10.64 contribution each
- Contribution per guest$10.64
- Net revenue per guest$26.00
- Variable cost per guest$15.36
- Sales needed at full price$3,616
- Projected result at your forecast120 guests × $10.64 contribution − $1,200 cost$76.80
- Margin of safetyGuests above break-even. A negative number means the forecast does not cover the cost.7
These must be incremental guests. A guest who would have come anyway contributes nothing new; they simply take the discount.
03 Show the arithmetic
Variable cost per guest = expected spend × variable cost %
Net revenue per guest = expected spend − discount given
Contribution per guest = net revenue − variable cost
Guests needed = direct promotion cost ÷ contribution per guest, rounded up
04 What the answer leaves out
- Count only incremental guests. Regulars who would have come anyway reduce the return rather than building it.
- Include only costs you avoid by cancelling. Rent and salaried management are already paid whether the promotion runs or not.
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