Glossary · Business & Sourcing
What Is Break-Even Volume?
Break-even volume is the number of units a product must sell to recover its fixed and development costs — tooling, artwork, safety assessment, testing and the minimum production run — before it contributes profit. In cosmetics, custom packaging and market registration raise this figure well above what unit-price arithmetic suggests.
Why it matters when you source
Founders usually calculate break-even from unit gross margin and forget the one-off costs, which are large in this industry. Add tooling, testing and registration to the model, then check whether your launch volume actually clears them.
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