High Wheel Bicycle Sales Break-Even Analysis: $283K Monthly Target

Fixed costs $23.1K/mo Payroll + overhead

Contribution margin 81.5% After variable costs

Break-even revenue $28.3K/mo Monthly target

Break-even timing Month 26 Cash turns positive

Break-even calculator

Test monthly revenue against variable expenses and fixed costs to see when the store covers overhead.

Lean Base Full

Monthly revenue Revenue sets the margin available to cover fixed costs. $ Low sales High sales Variable expenses Use direct costs that rise with each sale, like procurement and transaction fees. $ Lower costs Higher costs

Money available to cover fixed costs $43,492 $52,333 revenue - $8,841 variable expenses

Margin ratio

83%

Covers fixed costs

Yes

Fixed monthly costs This is the monthly overhead contribution margin has to cover. $ Lean overhead Heavy overhead

Break-even chart Revenue Total costs

Which expenses stay fixed and which move with sales for a high wheel bicycle retailer?

Cost classification

Break-even is only useful if each expense behaves the right way in the model. Here, revenue-linked bike procurement and delivery fees should flex with sales, while rent, insurance, and baseline staffing create the monthly hurdle.

Expense	Cost	Break-Even Treatment	Common Mistake
Procurement of Bikes and Parts	Variable	Model at 14.0% of revenue in the first year, improving to 11.0% by the fifth year.	Don’t treat inventory purchases as overhead.
Transaction and Delivery Fees	Variable	Model at 4.5% of revenue in the first year, falling to 3.3% by the fifth year.	Don’t ignore freight and payment fees.
Showroom Rent	Fixed	Use $2,500 per month from Month 1 through Month 60.	Don’t spread rent across units too early.
Utilities and Internet	Fixed	Use $600 per month in the source model.	Don’t inflate it without usage data.
Business Insurance	Fixed	Use $350 per month as a recurring operating expense.	Don’t skip test-ride and retail exposure.
Store Maintenance	Fixed	Use $250 per month during the monthly planning range.	Don’t tie routine upkeep to each sale.
Software Subscriptions	Fixed	Use $180 per month unless the plan changes with store scale.	Don’t model subscriptions as a sales percentage.
Wages	Semi-fixed	Use first-year payroll of $229,000 annually, then step it up as mechanic and marketing staffing rise.	Don’t hire ahead of traffic proof.

How does break-even change from a lean opening month to a base case and a full run rate for a high wheel bicycle store?

Scenario table

Traffic rises from 229 weekly visitors in Year 1 to 539 in Year 5, while conversion moves from 1.6% to 3.6%. That lifts revenue faster than fixed payroll and rent, so the store moves from cash burn to a clear cushion.

Planning case only; these figures are assumptions, not guarantees.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean opening case	$9.3k	$1.7k	$23.5k	81.5%	-$15.9k	Still below break-even and highly cash negative.
Base Year 3 ramp	$52.3k	$8.8k	$26.8k	83.1%	$16.7k	This is the Month 26 break-even path with a modest cushion.
Full Year 5 run rate	$192.2k	$27.5k	$28.5k	85.7%	$136.2k	Strong cushion here, so overhead is no longer the constraint.

What breaks the break-even plan for a penny-farthing bike store?

Stress test

Here’s the quick math: first-year break-even is about $283k in monthly revenue. A 20% demand miss opens about a $46k gap, and 10% fixed-cost creep or higher freight pushes the hurdle to $302k-$311k. Combined pressure leaves about an $81k hole.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change from the base plan.	$283k	$0 gap	No cushion; profit starts only above this.
Revenue shortfall	Monthly revenue runs 20% below break-even.	$283k	$46k gap	Slow traffic or low conversion opens a fast cash hole.
Fixed-cost pressure	Fixed costs rise 10% from the base plan.	$311k	$28k gap	Rent, payroll, or overhead creep raises the hurdle.
Margin pressure	Variable expenses rise from 185% to 235%.	$302k	$19k gap	Freight overruns can erase the cushion.
Combined pressure	Revenue is 20% below break-even, fixed costs rise 10%, and variable expenses rise to 235%.	$364k	$81k gap	Weak traffic plus cost creep breaks the model.

Can this high wheel bicycle shop cover its fixed load before you sign the lease?

Founder checklist

Check the opening plan against the model’s break-even path before you lock inventory, staff, or space. With Month 26 break-even and a $503k cash low, the shop only works if traffic, margin, and capacity all hold.

1Supply LeadPre-deposit

Verify bikes and parts can arrive before any inventory deposit, and confirm insurance for retail, storage, and test rides.

2Build Capacity0.5 FTE

Confirm the mechanic and sales team can assemble, tune, and hand off bikes fast enough to avoid delays and returns.

3Contribution81.5% CM

Test procurement at 14% and delivery at 4.5%; if the combined cost load runs higher, the break-even math slips fast.

4Fixed Burn$23.1k/mo

Make sure rent, payroll, utilities, insurance, and software stay near this level, and do not add a bigger lease before Month 26 proof.

5Traffic Base229/wk

Check whether 229 weekly Year 1 visitors can really support 1.6% conversion, which is only about 3.7 new buyers a week.

6Cash Buffer$503k

Keep this reserve in place, because the model stays under water until Month 26 and Year 1 EBITDA is negative.