Linear Accelerator Room Construction Break-Even: $165K/Month

Fixed costs $46.2K/mo Overhead base

Contribution margin 69.8% After variable costs

Break-even revenue $66.2K Monthly target

Break-even timing Month 1 Launch month

Break-even calculator

Test monthly revenue, variable expenses, and fixed costs against break-even for shielded radiation-therapy room projects.

Lean Base Full

Monthly revenue Use this as the monthly billings base before direct project costs. $ Small pipeline Big pipeline Variable expenses These are direct project costs that rise with each job. $ Low direct cost High direct cost

Money available to cover fixed costs $2,869,283 $3,478,833 revenue - $609,550 variable expenses

Margin ratio

82%

Covers fixed costs

Yes

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

Break-even chart Revenue Total costs

Which expenses stay fixed, and which move with shielded room sales?

Cost classification

Break-even lands in Month 1, but that only holds if project labor, freight, certification work, and commissions move with sales. Treating them as fixed overhead will overstate contribution and understate cash needs.

Expense	Cost	Break-Even Treatment	Common Mistake
Headquarters lease	Fixed	Include $12,500 per month as base overhead from Month 1 through Month 60.	Allocating rent by project and hiding the monthly cash floor.
Professional liability insurance	Fixed	Include $8,000 per month before calculating the revenue needed to cover overhead.	Treating coverage as avoidable when a job slips or starts late.
Shielding materials and direct installation labor	Variable	Subtract per-room inputs before contribution; a first-year LINAC vault carries $125,000 of listed unit inputs.	Putting project labor into overhead and overstating gross margin.
Shielding certification labor	Variable	Model as 2.0% of related project revenue, so it rises with completed room sales.	Treating certification work as fixed even though each job needs signoff.
Sales commissions	Variable	Apply the revenue rate by year: 3.0% in the first year, falling to 2.0% in the mature year.	Using a flat payroll assumption and missing deal-linked selling expense.
Equipment shipping and freight	Variable	Apply 4.0% of revenue in the first year, stepping down to 2.0% by the mature year.	Fixing freight in overhead instead of tying it to project volume.
Project manager staffing	Semi-variable	Keep a base team, then add capacity as project volume grows from 22 rooms in the first year to 82 rooms in the mature year.	Assuming two first-year managers can carry mature-year volume.
Structural design engineering staffing	Semi-fixed	Step staffing from 1.0 FTE in the first year toward 4.0 FTE in the mature year as design capacity fills.	Spreading mature-year payroll across early volume and making break-even look too high.

How does break-even shift from a lean Year 1 mix to full volume?

Scenario table

All three cases sit above the roughly $165K monthly break-even line, so the real question is cushion, not survival. Lean volume trims profit, but the fixed-cost base stays the same and the model still clears break-even fast.

Planning cases only; project wins, billing timing, and utilization can still move the result.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean: Year 1 mix without Proton Bay	$1.04M	$249K	$125K	76%	$663K	Still above break-even, but the cushion is thinner.
Base: Full Year 1 mix	$1.50M	$359K	$125K	76%	$1.01M	This is the core case and it clears break-even with room to spare.
Full: Year 2 volume mix	$2.13M	$512K	$125K	76%	$1.50M	Best cushion here; higher volume widens the gap from break-even.

What breaks this break-even plan first: delayed awards, higher payroll, or margin compression?

Stress test

The base plan has a wide cushion, but a zero-billing month still burns about $125K of fixed overhead. Early hiring or margin slip pushes the break-even line up fast.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	Year 1 fixed overhead stays as planned.	$165K	$1.331M cushion	Year 1 average monthly revenue stays well above break-even.
Revenue shortfall	One project month bills at $0.	$165K	$165K gap	A slipped award leaves the month cash-negative before setup costs.
Fixed-cost pressure	Carry the Year 5 staffing plan into the opening month.	$357K	$1.139M cushion	Early hiring lifts the hurdle, but the plan still clears it in a strong month.
Margin pressure	Contribution margin slips from 76% to 70%.	$179K	$1.317M cushion	Labor overruns, shielding inflation, or rework push the break-even line higher.
Combined pressure	Year 5 staffing lands early and margin falls to 70%.	$387K	$1.108M cushion	Delayed starts plus weaker margin narrow cash room fast.

What should the founder verify before signing the first lease and buying equipment for shielded therapy rooms?

Founder checklist

You’re ready only if signed or near-signed work can cover the opening fixed load. The model shows break-even in Month 1, but backlog, staffing, and cash need to be in place before you lease or buy equipment.

1Backlog proof22 jobs

Verify near-signed work matches the Year 1 mix of 4 LINAC Vaults, 8 PET Shields, 3 HDR Suites, 6 CT Bunkers, and 1 Proton Bay before you take on fixed overhead.

2Fixed load$125.4K/mo

Confirm lease, insurance, software, marketing, utilities, compliance, and salaried staff stay at about this monthly burn so the first jobs do not carry a bigger cost base than planned.

3Bid margin77% CM

Check that each quote still clears the listed room price after unit materials, job labor, commissions, freight, and the 6% revenue-based job costs, or one bad bid can wipe out margin.

4Workflow ramp7 to 21 FTE

Map permit, inspection, physics review, and commissioning to named owners so the starting team can move jobs through without slowing field crews or the Year 5 staffing plan.

5Cash floor$1.171M

Keep working cash above the Month 1 minimum, because that is the tightest point and setup spend lands before revenue is fully steady.

6Capex timing$980K capex

Make sure the fleet, server, formwork, and lab spend can wait if a project slips, so capital does not leave before billable work starts.