Karaoke Bar Break-Even Analysis: About $72K Monthly Revenue

Fixed costs $58.7K Monthly base load

Contribution margin 81.5% After variable costs

Break-even revenue $72.0K Monthly revenue target

Break-even timing Month 3 First hit point

Break-even calculator

Use this calculator to test monthly revenue, variable costs, and fixed costs against break-even.

Lean Base Full

Monthly revenue Revenue is the top line that creates room for costs and overhead. $ Low traffic Busy nights Variable expenses Use direct costs that move with sales, like drinks, food, card fees, and promos. $ Lean costs High costs

Money available to cover fixed costs $260,249 $292,413 revenue - $32,164 variable expenses

Margin ratio

89%

Covers fixed costs

Yes

Fixed monthly costs Use the monthly cost base the bar must cover, including rent, payroll, and overhead. $ Lower base Heavier base

Break-even chart Revenue Total costs

Which venue expenses stay fixed, and which move with sales?

Cost classification

Your break-even is only as useful as the cost behavior behind it. Fixed items set the monthly hurdle; variable items reduce contribution margin; semi-variable and semi-fixed items need usage or capacity rules, not a flat percent.

Expense	Cost	Break-Even Treatment	Common Mistake
Rent Lease Payments	Fixed	Model $12,000 per month from Month 1 through Month 60.	Leaving rent out until sales ramp.
Utilities Gas Electricity Water	Semi-variable	Start with the $2,500 monthly base, then stress test longer hours and higher traffic.	Treating utilities as flat when late nights rise.
Cleaning Services	Semi-variable	Use the $1,500 monthly base, with added coverage as weekend volume builds.	Missing extra cleanup after peak nights.
Music Licensing	Semi-fixed	Include $150 per month before opening; confirm coverage before launch.	Tying licensing to nightly sales instead of access rights.
Food & Meat Costs	Variable	Use 11.0% of revenue in the first year, declining to 10.0% by the fifth year.	Using gross sales without the food percentage.
Beverage Costs	Variable	Use 3.5% of revenue in the first year, declining to 3.0% by the fifth year.	Applying one margin to food and beverage.
Credit Card Fees	Variable	Model 1.5% of revenue each year because fees move with paid sales.	Forgetting card fees in contribution margin.
Staffing Wages	Semi-fixed	Year 1 salaries total $481,000, or about $40,083 per month, before growth in headcount.	Modeling all labor as purely sales-driven.

How does break-even move from a lean karaoke bar to a full house?

Scenario table

More weekend traffic and higher checks lift revenue faster than variable costs, so the fixed rent and payroll get easier to absorb. The base case is the key test: it shows whether demand can outrun staffing.

Planning assumptions only; actual sales, labor, and margin mix can move these results.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean karaoke bar	$1.74M	$322k	$587k	81.5%	$833k	Clears break-even, but cushion is still thin.
Base karaoke bar	$2.92M	$506k	$842k	82.7%	$1.58M	Break-even is covered, but staffing still needs discipline.
Full karaoke bar	$4.26M	$681k	$1.07M	84.0%	$2.51M	Strong cushion; higher weekend volume covers overhead faster.

What breaks first if turnout slips or costs creep up?

Stress test

The plan breaks fast if weekend traffic comes in light or the bar adds staff before demand shows up. With a thin cushion at break-even, a 15% sales miss or a 10% fixed-cost bump can turn into a five-figure monthly gap.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	about $720,000	$0 gap	No cushion if sales miss.
Revenue shortfall	Revenue runs 15% below break-even.	about $720,000	about $88,000 gap	Weak weekend turnout wipes out the month.
Fixed-cost pressure	Fixed costs rise 10% to about $646,000 a month.	about $793,000	about $59,000 gap	Rent or added staff pushes the model off target.
Margin pressure	Contribution margin falls to 76.5% from higher drink costs or more comped items.	about $767,000	about $36,000 gap	Small promo and fee leaks matter here.
Combined pressure	Revenue falls 15%, contribution margin drops to 76.5%, and fixed costs rise 10%.	about $844,000	about $178,000 gap	Two or three hits make break-even fragile fast.

Can this karaoke bar clear break-even before you sign the lease?

Founder checklist

Only if the bar can cover about $58.7K in monthly fixed load and still clear break-even by Month 3 on normal trading. Don’t sign the lease until weekly guests, staffing, cash, and the opening build-out all check out without leaning on one-off events or debt draws.

1Fixed load$58.7K/mo

Check that rent, utilities, insurance, software, cleaning, maintenance, legal, licensing, and Year 1 payroll really stay near this level, because that is the cash you must cover before owner pay.

2Guest traffic780/week

Verify Year 1 demand can reach 510 guests from Friday to Sunday and 270 from Monday to Thursday, or the lease will lean too hard on peak nights.

3Margin mix81.5% CM

Make sure food, beverage, marketing, and card fees leave about 81.5% contribution margin, because a few points of drift pushes break-even up fast.

4Night crew12 FTE

Confirm you can staff late nights with the Year 1 12-FTE plan, since extra cover without extra sales raises break-even.

5Cash reserve$592K

Keep at least the $592K minimum cash the model shows by Month 2, or the opening gap can force bad shortcuts before sales stabilize.

6Launch build$430K

Fund the $430K of opening capex and lock music licensing before launch, because those costs hit before the bar can rely on normal revenue.