Custom Plastic Molding Break-Even Revenue: $815K/Month

Fixed costs $73.0K/mo Base overhead + payroll

Contribution margin 89.6% After variable costs

Break-even revenue $81.5K/mo Monthly target

Break-even timing Month 1 Launch break-even

Break-even calculator

Test whether monthly molding revenue covers resin, labor, shipping, and the fixed plant bill.

Lean Base Full

Monthly revenue Revenue is the top line that creates room for fixed costs. $ Low volume Peak volume Variable expenses These are the direct costs that rise with each molding order. $ Lean cost Heavy cost

Money available to cover fixed costs $338,853 $374,792 revenue - $35,939 variable expenses

Margin ratio

90%

Covers fixed costs

Yes

Fixed monthly costs This is the monthly cost base contribution margin must cover. $ Light overhead Heavy overhead

Break-even chart Revenue Total costs

Which expenses are fixed, and which move with sales in this molding operation?

Cost classification

Break-even is only useful if fixed overhead stays fixed and unit costs move with production. Here, resin, labor, energy, packaging, finishing, commissions, and shipping change with volume, while rent and base overhead set the monthly hurdle.

Expense	Cost	Break-Even Treatment	Common Mistake
Polymer Resin Cost	Variable	Apply per unit produced: $0.20 to $0.70 by part family in the first year.	Treating resin as fixed and missing margin pressure when scrap or resin usage rises.
Direct Labor per Unit	Variable	Apply per unit produced: $0.15 to $0.40 by part family in the first year.	Blending unit labor with salaried staff and overstating contribution margin.
Energy Cost per Unit	Variable	Apply per unit produced: $0.03 to $0.15 by part family in the first year.	Putting all utilities into fixed overhead and ignoring machine uptime impact.
Packaging Material and Finishing Process	Variable	Apply per unit produced: packaging is $0.02 to $0.08, and finishing is $0.05 to $0.22 in the first year.	Using one flat percentage of revenue instead of part-level unit costs.
Facility Lease Payment	Fixed	Include $15,000 per month in recurring fixed overhead from Month 1 through Month 60.	Changing rent with unit volume instead of treating it as the monthly hurdle.
Utilities Base and Unit Energy	Semi-variable	Model the $2,500 monthly base as fixed, then add unit energy separately as production runs.	Double-counting energy by loading it into both base utilities and per-unit COGS.
Salaried Production Roles	Semi-fixed	Step headcount by year: Senior Machine Operators rise from 2.0 FTE in Year 1 to 6.0 FTE in Year 5.	Scaling salaried roles as a constant revenue percentage instead of capacity steps.
Sales Commissions and Shipping & Logistics	Variable	Subtract 5.0% of first-year revenue: 3.0% commissions plus 2.0% shipping and logistics.	Forgetting these revenue-based charges when calculating contribution margin.

How does break-even shift from lean to full output in custom plastic molding?

Scenario table

Lean output is just under break-even, base output clears fixed overhead, and full output adds a wide profit cushion. Units are the utilization proxy here because machine hours and scrap rates are not supplied.

Planning figures use the model assumptions and are not guarantees.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean custom molding load	$81,250	$8,453	$73,000	89.6%	-$203	Near breakeven; small swings flip it.
Base Year 1 production plan	$135,417	$14,088	$73,000	89.6%	$48,329	Fixed overhead is covered with cushion.
Full Year 2 production load	$250,354	$25,020	$83,417	90.0%	$141,917	High volume creates a strong profit cushion.

What breaks or pressures the break-even plan for this molding shop?

Stress test

The plan clears recurring break-even at $81,500 a month, with about $53,900 of monthly cushion on the Year 1 run rate. The main risks are softer orders, more scrap or rework, slower uptime, and hiring before demand is signed.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$81,500	$53,900 cushion	The base plan clears break-even, but the cushion still depends on steady orders.
Revenue shortfall	Monthly revenue runs 20% below the Year 1 plan.	$81,500	$26,820 cushion	Sales softness cuts the cushion almost in half, so demand tracking matters.
Fixed-cost pressure	Fixed overhead rises by $5,000 a month from early hiring or rent.	$87,080	$48,320 cushion	Higher overhead lifts the floor and makes hiring timing a real break-even risk.
Margin pressure	Scrap, rework, or overtime adds $1,000 a month to variable cost.	$82,616	$52,784 cushion	Each extra $1,000 of waste needs about $1,116 more revenue to stay even.
Combined pressure	Revenue runs 40% below plan, fixed overhead rises $5,000 a month, and variable cost rises $1,000 a month.	$87,080	$5,840 gap	This is the tightest case; a weak sales patch plus cost creep would push losses fast.

What must the founder verify before locking in the molding line and lease?

Founder checklist

This is a go only if Year 1 demand, staffing, and cash all hold up before the big spend. The model works on paper, but you should not commit to the full build unless the pipeline and ramp are real.

1Demand Proof$1.63M Year 1

Verify signed or highly qualified orders across the five parts, because the first-year plan depends on 85,000 units, not just interest.

2Lease Load$15.0K/mo

Confirm the facility lease stays supportable at $15,000 a month, since that fixed cost starts in Month 1 and hits before volume fully ramps.

3Unit Margin≈89%

Check that resin, labor, energy, packaging, finishing, commissions, and shipping still leave enough contribution to cover the overhead stack and payback target.

4Operator Cover2 senior FTE

Verify coverage for 2.0 senior machine operators in Year 1, because missed shifts or thin coverage will break the output needed for break-even.

5Cash CushionMonth 11

Hold enough working capital through Month 11, since minimum cash reaches negative $9,000 there and the build needs reserves to avoid a stall.

6Capex Gate$1.685M

Do not lock in the full equipment and setup spend until pipeline and ramp proof are in hand, and delay the second machine, automation, and inventory build if demand is still soft.