Ground Freezing Contractor Break-Even: About $200K/Month

Fixed costs $39.2K/mo Month 1 overhead

Contribution margin 68% After variable costs

Break-even revenue $57.6K/mo Monthly target

Break-even timing Month 3 Forecast crossover

Break-even calculator

Test how monthly revenue, variable expenses, and fixed costs work together to hit break-even in ground freezing construction.

Lean Base Full

Monthly revenue Revenue is the top line that funds contribution margin. $ Slower month Peak month Variable expenses Use costs that rise with each project, like energy, drilling, logistics, and project insurance. $ Tighter direct costs Heavier direct costs

Money available to cover fixed costs $1,320,179 $1,970,417 revenue - $650,238 variable expenses

Margin ratio

67%

Covers fixed costs

Yes

Fixed monthly costs These are the monthly overhead costs that break-even must cover. $ Lean overhead Higher overhead

Break-even chart Revenue Total costs

Which ground freezing contractor expenses stay fixed, and which move with project volume?

Cost classification

Break-even works only if fixed overhead, stepped staffing, and job-linked expenses are kept separate. Misclassify one large item, and Month 3 break-even can look safer than it really is.

Expense	Cost	Break-Even Treatment	Common Mistake
Yard and maintenance facility rent, $15,000/month	Fixed	Include in monthly overhead before profit.	Burying rent inside project bids.
Specialized professional liability insurance, $8,500/month	Fixed	Cover before counting operating profit.	Treating it as project-specific insurance.
Engineering software subscriptions, $3,200/month	Fixed	Carry as base overhead across all jobs.	Charging it only to engineering hours.
First-year payroll, about $87,083/month	Semi-fixed	Step crews and managers with backlog.	Modeling payroll as purely variable.
Annual marketing budget, $120,000	Semi-fixed	Plan at about $10,000/month.	Linking spend to each awarded project.
Project energy and refrigerant, 14% of revenue	Variable	Deduct from each revenue dollar.	Leaving usage out of gross margin.
Subcontracted drilling services, 10% of revenue	Variable	Include in direct job margin.	Calling subcontract work overhead.
Site mobilization and logistics, 5% of revenue	Variable	Apply by active project volume.	Using one flat monthly allowance.

How does break-even change from a lean month to a full backlog month?

Scenario table

Break-even shifts with utilization because fixed overhead stays high while each active project spreads staffing and setup across more billable hours. In this model, more billable hours mean a wider cushion.

Planning assumptions only; actual margin and break-even will move with project mix, site conditions, and mobilization timing.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean single-project month	$264.5k	$84.7k	$136.3k	68.0%	$43.6k	Clears overhead, but the cushion is thin.
Base four-project month	$1.06M	$338.6k	$136.3k	68.0%	$583.2k	Gives a solid cushion and lowers break-even risk.
Full six-project month	$1.59M	$507.9k	$136.3k	68.0%	$943.0k	Builds a strong cushion if crews stay fully used.

What pressures break-even for a ground freezing contractor?

Stress test

The plan clears break-even in Year 1, but the cushion depends on steady project starts and tight field costs. A 20% revenue miss, a 5-point margin drop, or a 10% fixed-cost rise can shrink that buffer fast.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change to Year 1 revenue or 32% variable expense.	$2,643,000	$10,054,000 cushion	The base plan clears break-even with room to spare.
Revenue shortfall	Revenue drops 20% from the Year 1 average.	$2,643,000	$7,515,000 cushion	A 20% top-line miss still covers break-even, but the cushion shrinks fast.
Fixed-cost pressure	Fixed operating load rises 10%.	$2,907,000	$9,790,000 cushion	A 10% overhead rise hurts, yet the model still stays above break-even.
Margin pressure	Variable expense rises 5 points to 37%.	$2,852,000	$9,845,000 cushion	A 5-point cost spike trims the cushion and makes field waste costly.
Combined pressure	Revenue falls to one active project while variable expense rises to 37% and fixed load rises 10%.	$3,138,000	$493,000 gap	One active project at this cost mix is the danger zone.

Can this ground freezing contractor absorb the plant, payroll, and lease load before the first big excavation job is signed?

Founder checklist

Before you buy plant or lock in a yard lease, test whether the first operating year can carry the fixed load and still reach break-even by Month 3. The model shows strong revenue potential, but minimum cash bottoms out at negative $542K in Month 5, so timing and reserves matter.

1Plant capex$2.31M

Verify you can fund the mobile refrigeration plant, piping, sensors, trucks, trailers, tooling, and workstations before committing, because that spend comes up front and drives the cash trough.

2Lease load$15K/mo

Check that the 60-month yard lease fits your launch cash plan, since the facility cost is fixed from Month 1 and does not wait for the first project.

3Payroll run$87.1K/mo

Confirm you can carry Year 1 payroll for engineering, project management, field techs, thermal analysis, business development, and safety, because the crew cost is the largest steady monthly drag.

4Marketing burn$120K

Make sure the Year 1 marketing budget and $15K CAC still produce qualified project leads, since weak demand would leave the fixed team and plant underused.

5Job economics21.08% IRR

Stress-test each project on power availability, mobilization path, insurance, drilling subcontractor terms, thermal monitoring coverage, maintenance, bonding, and change-order rules so the job still clears the model’s return.

6Cash bufferMonth 5

Hold enough reserve to survive the Month 5 cash low, because the model reaches break-even in Month 3 but still needs about 9 months to pay back the early investment.