Vehicle Impound Lot Break-Even Analysis: Break Even by Month 15

Fixed costs $19.5K/mo Overhead only

Contribution margin N/A No variable data

Break-even revenue N/A Revenue not set

Break-even timing Month 15 Modeled payback

Break-even calculator

Test monthly revenue, variable expenses, and fixed costs for a vehicle impound lot against monthly break-even.

Lean Base Full

Monthly revenue Revenue is the cash engine that has to cover direct costs and overhead. $ Lower sales Higher sales Variable expenses These are direct costs that rise with monthly revenue. $ Lower direct cost Higher direct cost

Money available to cover fixed costs $65,600 $65,600 revenue - $0 variable expenses

Margin ratio

100%

Covers fixed costs

Yes

Fixed monthly costs This is the monthly cost base the business must cover. $ Lower overhead Higher overhead

Break-even chart Revenue Total costs

Which impound lot expenses are fixed, variable, or scale with activity?

Cost classification

Break-even gets noisy when rent, payroll, and release-driven activity are blended together. In this model, the clean view is fixed overhead first, then semi-variable yard activity, then staffing steps as more lots open.

Expense	Cost	Break-Even Treatment	Common Mistake
Property Insurance	Fixed	Use $3,500/month as recurring overhead from Month 1 through Month 60.	Spreading it across vehicles and treating it like a per-release charge.
Security Monitoring Services	Fixed	Use $2,800/month as baseline site security overhead.	Tying the full amount only to vehicle count instead of operating readiness.
Facility Maintenance	Semi-variable	Model the $4,000/month base separately from repairs that rise with yard activity.	Putting all upkeep in fixed overhead and missing high-volume wear.
Impound Management Software	Fixed	Include $1,500/month from Month 1 in the break-even floor.	Starting software expense only after volume ramps, which understates early losses.
Utilities and Lighting	Semi-variable	Use $2,200/month as the base, then stress-test higher night operations.	Assuming power use stays flat when security lighting and access hours expand.
Property Taxes	Fixed	Keep $5,500/month separate from rent and treat it as recurring overhead.	Combining property taxes with rented-yard payments and hiding true site burden.
Staffing	Semi-fixed	Use about $28,900/month after the Inventory Specialist starts, then step up with staffing needs.	Modeling payroll as a percent of revenue instead of scheduled headcount.
Yard Rent	Fixed	Use South Yard at $12,000/month, West Lot at $10,000/month, and City Depot at $11,000/month when active.	Mixing rented-yard payments with owned-site purchase costs in operating break-even.

How does break-even change from a lean two-yard setup to a full seven-yard network?

Scenario table

More yards lift listed revenue, but they also add rent and payroll fast. With no variable costs provided, the break-even swing comes mostly from fixed overhead, so handling and collection leakage still matter.

Planning assumptions only; no variable costs were provided, so actual margins can run lower.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean case: North Yard + South Yard	$120,000	$0	$56,400	100%	$63,600	Positive, but the cushion is thin if collections slip.
Base case: North, South, East, and West	$240,000	$0	$70,400	100%	$169,600	This is the first clear break-even step and matches the Month 15 target.
Full case: seven-yard network	$440,000	$0	$101,800	100%	$338,200	Best cushion, but payroll growth and site rent still need control.

What breaks this impound lot’s break-even cushion?

Stress test

Month 15 is covered on paper: about $240,000 of revenue against roughly $70,400 of monthly fixed burden, leaving a $169,600 cushion. Break-even means the monthly revenue needed to cover fixed overhead, and the weak spots are slower intake, higher rent and payroll, and any handling costs not in the model.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$70,400	$169,600 cushion	Base Month 15 revenue still clears fixed overhead.
Revenue shortfall	Fee revenue falls 25% from the Month 15 base.	$70,400	$109,600 cushion	The lot still breaks even, but the safety margin shrinks fast.
Fixed-cost pressure	Rent, insurance, security, utilities, and payroll rise 20%.	$80,800	$159,200 cushion	Overhead moves up, so the launch needs tighter cost control.
Margin pressure	Add 15% of revenue for release labor and handling costs.	$82,824	$157,176 cushion	Blank variable costs hide real drag on the margin.
Combined pressure	Revenue falls 25%, overhead rises 20%, and handling costs take 15%.	$95,059	$84,941 cushion	This is the launch warning: weak intake and higher costs can drain cash toward the Month 26 low point.

What should the founder verify before signing the first yard lease for a vehicle impound lot?

Founder checklist

Don’t sign the first yard lease until the contract path, build order, and cash runway all line up with the Month 15 break-even. The model needs early losses covered before the later yards and staff ramp can carry the network.

1Contract pathBefore lease

Confirm the zoning fit and the police or property-owner contract path first, because the lot only works if impound volume is tied to the yard before you commit.

2Fixed burn$44.4K/mo

Check that the launch team and operating overhead fit a monthly burn of about $44.4K before you add more staff or take on a bigger site.

3Break-evenMonth 15

The model does not reach break-even until Month 15, so the first commitment only works if cash can carry the opening loss without slowing the rollout.

4Build budget$2.23M

The yard construction budgets total $2.23M, and the $700K core capex for surveillance, fencing, paving, office space, lighting, and gate automation has to be funded in order.

5Cash reserve$406K

Keep cash above the $406K minimum because the model bottoms out in Month 26, and a thinner reserve leaves no room for delays or slower intake.

6Staffing rampMonth 6

Hold the Inventory Specialist until Month 6 and do not hire ahead of release volume unless cash runway supports it, because payroll is already heavy before that role starts.