Deep Water Running Break-Even Analysis: $20K Monthly Revenue

Fixed costs $2.25K/mo Base overhead

Contribution margin 80% After variable costs

Break-even revenue $2.8K/mo Revenue floor

Break-even timing Month 14 Model turns positive

Break-even calculator

Test monthly revenue, variable expenses, and fixed costs to see where this class breaks even.

Lean Base Full

Monthly revenue Higher sales create more contribution margin to cover fixed costs. $ Low sales High sales Variable expenses Pool rental, payment fees, ad spend, and referral commissions rise with sales. $ Low costs High costs

Money available to cover fixed costs $30,414 $37,000 revenue - $6,586 variable expenses

Margin ratio

82%

Covers fixed costs

Yes

Fixed monthly costs Use the monthly overhead for staffing, software, rent, utilities, insurance, and admin. $ Lean overhead Heavy overhead

Break-even chart Revenue Total costs

Which deep water running expenses are fixed, and which move with sales?

Cost classification

Break-even is only useful if each expense behaves the right way in the model. Treat revenue-linked fees as variable, keep true monthly bills fixed, and step payroll when staffing capacity changes.

Expense	Cost	Break-Even Treatment	Common Mistake
Pool Rental Fees	Variable	Apply as a revenue-linked charge; Year 1 uses 12.0% of revenue.	Treating pool access as fixed rent when the model prices it as sales-linked.
Merchant Processing Fees	Variable	Apply to paid sales; Year 1 uses 3.0% of revenue.	Modeling card fees as a flat subscription instead of a sales percentage.
Digital Marketing Ad Spend	Variable	Use as a demand-linked spend; Year 1 is 4.0% of revenue.	Holding ads flat while class volume and revenue scale up.
Referral Commission for Clinics	Variable	Apply to referred revenue; Year 1 starts at 1.0% of revenue.	Ignoring referral drag as clinic-sourced rehabilitation sessions grow.
Booking Software Subscription	Fixed	Include $250 per month before calculating monthly break-even.	Spreading it per class and hiding the true monthly hurdle.
Administrative Office Rent	Fixed	Include $1,200 per month as baseline overhead.	Linking office rent to occupancy even though it stays stable in the model.
Professional Liability Insurance	Fixed	Include $150 per month as required operating overhead.	Leaving insurance out because it doesn’t vary by session count.
Program and Instructor Payroll	Semi-fixed	Step payroll up as full-time equivalent staffing rises by year.	Assuming payroll moves smoothly with each new member instead of in staffing jumps.

How does break-even shift from a lean pilot to a full deep water running schedule?

Scenario table

Break-even improves as billable days, occupancy, and segment mix rise. The lean pilot stays loss-making, the base case turns positive around Month 14, and the full case creates a much larger cushion.

Planning figures use the model assumptions above, so actual enrollment, pricing, and pool access can still move results.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean Year 1 pilot	$8.8k	$1.8k	$16.0k	80.0%	-$8.9k	Still below break-even; fixed load is too heavy.
Base Year 2 launch cadence	$37.0k	$6.6k	$27.2k	82.2%	$3.3k	Turns positive around Month 14, but cushion is still thin.
Full Year 3 scale case	$111.7k	$18.4k	$36.0k	83.5%	$57.3k	Strong cushion as Senior Mobility Group, Athlete Cross Training, Rehabilitation Sessions, and flotation belt sales scale.

What breaks the break-even plan for a deep water running class?

Stress test

The plan is most exposed to attendance, pool access, and staffing. At Year 2, the base case has only about a $47k cushion, so a 20% revenue miss or a 5-point margin slip can wipe out break-even fast.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$397k	$47k cushion	Only a $47k cushion; 14+ day onboarding or weak clinic referrals can erase it.
Revenue shortfall	Year 2 revenue falls 20% to $355k.	$397k	$42k gap	A 20% attendance miss turns the cushion into a gap.
Fixed-cost increase	Fixed payroll and overhead double to $652k a year.	$793k	$349k gap	Doubling staffing and overhead pushes break-even far above the current plan.
Margin pressure	Variable expenses rise 5 points to 22.8%.	$422k	$22k cushion	A small fee or ad-spend slip leaves very little room.
Combined pressure	Revenue falls 20%, fixed costs double, and variable expenses rise 5 points.	$845k	$489k gap	Low pool slot consistency plus higher costs create a wide gap.

Is the deep water running class ready to lock in pool time, staffing, and launch spend?

Founder checklist

Don’t lock in pool time, payroll, or ad spend until pricing, occupancy, and staffing support the Month 14 break-even path. Keep the cash plan tight too, because minimum cash peaks at $785K in Month 24.

1Pool access45% occupancy

Confirm the pool can hold the Year 1 fill target before you sign rental terms or buy equipment, because capacity and cost set the break-even path.

2Price test$120/$150/$180

Validate that Senior Mobility Group, Athlete Cross Training, and Rehabilitation Sessions can sell at the Year 1 monthly prices before you count on occupancy growth.

3Staffing load1.0/1.0/0.5 FTE

Line up Program Director, Lead Aquatic Instructor, and Customer Support Coordinator coverage before payroll expands, or empty classes will turn into cash burn.

4Fixed burn-$107K EBITDA

Use Year 1 EBITDA as the guardrail and keep overhead inside the model, because the first year still runs negative before scale kicks in.

5Launch stackPre-launch

Test the booking software, stock the $5K flotation belts, and keep early marketing capped until conversion is proven, so launch day does not become a costly reset.

6Cash reserve$785K

Track Month 14 break-even weekly and keep enough cash for the Month 24 low point, since minimum cash peaks at $785K.