Cargo Van Delivery Service Break-Even: $414K Monthly Revenue

Fixed costs $13.8K/mo Overhead only

Contribution margin 82.5% After variable costs

Break-even revenue $16.7K/mo Monthly revenue needed

Break-even timing Month 26 Model break-even point

Break-even calculator

Test monthly revenue against variable costs and fixed costs to see when the cargo van operation breaks even.

Lean Base Full

Monthly revenue Revenue is the cash that has to cover direct costs and the fixed cost base. $ Low sales High sales Variable expenses These rise with each delivery, route, and payment processed. $ Low costs High costs

Money available to cover fixed costs $74,448 $88,000 revenue - $13,552 variable expenses

Margin ratio

85%

Covers fixed costs

Yes

Fixed monthly costs This is the monthly cost base the margin must cover. $ Low base High base

Break-even chart Revenue Total costs

Which cargo van delivery expenses are fixed, variable, or capacity-based for break-even?

Cost classification

Break-even is only reliable when monthly overhead stays separate from costs that move with jobs or revenue. The big mistake is treating fuel or per-job driver pay like fixed overhead.

Expense	Cost	Break-Even Treatment	Common Mistake
Vehicle Lease Payments	Fixed	Use $8,000/month as fixed overhead in the break-even formula.	Spreading the lease across each delivery and hiding true monthly overhead.
Vehicle Insurance	Fixed	Use $1,500/month as fixed overhead while coverage stays stable.	Treating insurance as if it rises with every delivery.
Routing & Dispatch Software	Fixed	Use $500/month as fixed overhead for the current planning range.	Putting the full software fee into variable expense per job.
Office Rent	Fixed	Use $2,000/month as fixed overhead through the modeled period.	Allocating rent per delivery and understating break-even volume.
Fuel Costs per Delivery	Variable	Use 6.0% of revenue in the first year, falling to 5.0% by the fifth year.	Putting fuel into fixed overhead instead of reducing contribution margin.
Contractor Driver Pay per Job	Variable	Use 4.0% of revenue in the first year, falling to 3.0% by the fifth year.	Modeling per-job driver pay as a salary line.
Payment Processing Fees	Variable	Use 2.5% of revenue in the first year, falling to 2.2% by the fifth year.	Leaving processing fees out of contribution margin.
Delivery Drivers	Semi-fixed	Add salaries in steps as staffing rises from 2.0 FTE in the first year to 10.0 FTE in the fifth year.	Treating driver headcount as fully variable with each order.

How does break-even shift from a lean start to fuller route use in a cargo van delivery service?

Scenario table

Lean routes stay below break-even because fixed costs are still too heavy. By the base case, the gap is nearly closed, and the full case adds a real cushion as route density lifts revenue faster than cost growth.

Planning assumptions only; actual results will move with fuel, route density, and paid utilization.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean same-day mix	$23.1K	$4.0K	$34.2K	82.5%	-$15.1K	About a $15.1K monthly gap, so break-even is still out of reach.
Base route build	$51.2K	$8.5K	$43.3K	83.4%	-$0.6K	Nearly flat, with the model reaching break-even around Month 26.
Full route density	$88.0K	$13.6K	$52.1K	84.6%	$22.4K	Roughly $22.4K of monthly cushion, so fixed costs are covered.

What breaks the break-even plan for a cargo van delivery service?

Stress test

The base plan is close to break-even at about $510K a month, with only a small cushion. A 10% revenue dip, a $50K overhead jump, or a 3-point margin squeeze can push the model back into a gap fast.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	Year 2 revenue, fixed costs, and margin stay unchanged.	$510K	$2K cushion	Small cushion, so misses hit fast.
Revenue shortfall	Year 2 revenue comes in 10% below plan.	$510K	$49K gap	Fewer booked jobs quickly erode coverage.
Fixed-cost increase	Monthly overhead rises by $50K.	$580K	$68K gap	Lease and payroll pressure move break-even up.
Margin pressure	Variable costs rise by 3 points.	$539K	$27K gap	Fuel or insurance spikes push breakeven out.
Combined pressure	Revenue falls 10%, margin drops to 80.4%, and fixed costs rise to $483K.	$574K	$113K gap	Volume and cost stress together break the model.

Can you prove demand, pricing, and cash before you buy the first cargo vans?

Founder checklist

Yes. Test booked monthly revenue, route density, and cash coverage against the model before you commit to vans or drivers. If the mix can’t hold near $75 same-day, $1,500 scheduled, and $60 hourly, the break-even plan gets shaky fast.

1Demand proof$41.3K/mo

Verify booked monthly revenue can clear the break-even line before you buy vans, because Year 1 sits around $23.1K a month versus a $41.3K monthly break-even.

2Base rates$75 / $1,500 / $60

Keep the quote sheet near these base rates, because the model only keeps about 82.5% contribution margin if price holds.

3Route density2,500 jobs

Map stops by service area before adding vans, because 2,500 same-day deliveries can still miss break-even if routes are too spread out.

4Fixed load$13.8K/mo

Get insurance quotes before you commit, because the fixed load is $13,750 a month and vehicle lease payments alone are $8,000.

5Driver ramp2 → 10 FTE

Build payroll only as route volume grows, because delivery driver capacity scales from 2 FTE in Year 1 to 10 FTE in Year 5.

6Cash runway$445K / Month 25

Hold the cash cushion first, because minimum cash is $445K, cash bottoms in Month 25, breakeven lands in Month 26, and the $157K launch capex is not working cash.