Mediation Consulting Break-Even Analysis: $35K Monthly Revenue

Fixed costs $5.9K/mo Base overhead

Contribution margin 72% After variable costs

Break-even revenue $8.2K/mo Revenue needed

Break-even timing Month 6 Model break-even

Break-even calculator

Test monthly revenue, variable expenses, and fixed costs against break-even for a mediation and negotiation consulting firm.

Lean Base Full

Monthly revenue Revenue sets the margin available to cover fixed costs. $ Low sales High sales Variable expenses Use direct case costs and marketing that rise with revenue. $ Light costs Heavy costs

Money available to cover fixed costs $33,500 $38,500 revenue - $5,000 variable expenses

Margin ratio

87%

Covers fixed costs

Yes

Fixed monthly costs This is the monthly cost base your contribution margin must cover. $ Lean base Heavier base

Break-even chart Revenue Total costs

Which expenses stay fixed, and which move with case volume in a mediation consulting practice?

Cost classification

Break-even is only useful if rent, insurance, software, mediator capacity, and case-level fees land in the right buckets. In this model, first-year break-even in Month 6 depends on separating fixed overhead from revenue-linked delivery costs.

Expense	Cost	Break-Even Treatment	Common Mistake
Office Rent & Utilities	Fixed	Include $3,500 each month from Month 1 through Month 60 in fixed overhead.	Assuming unused office space is harmless.
Professional Liability Insurance	Fixed	Carry $500 monthly as overhead before counting mediator profit.	Excluding it from break-even overhead.
Online Dispute Resolution Software Subscriptions	Variable	Model at 5% of first-year revenue, falling to 3% by Year 5.	Ignoring delivery tech in gross margin.
External Mediator Fees	Variable	Model at 10% of first-year revenue, improving to 8% by Year 5.	Underpricing subcontract mediator help.
Marketing & Advertising Campaigns	Variable	Use 10% of first-year revenue, then compare spend against the $25,000 first-year marketing budget and $500 customer acquisition cost.	Mixing acquisition spend with fixed overhead.
Client Travel & Case-Specific Materials	Variable	Apply 3% of first-year revenue for travel, files, and case materials tied to client work.	Letting travel overruns erode margin.
Administrative Assistant	Semi-fixed	Budget 0.5 full-time equivalent at a $50,000 annual salary in the first year; step up only when intake supports it.	Hiring before intake volume supports the role.
Senior Mediator	Semi-fixed	Plan 0.5 full-time equivalent at a $120,000 annual salary in the first year; added capacity should follow closed referrals.	Adding mediator capacity before referrals close.

How does break-even shift from a lean founder-led model to a full staffing model?

Scenario table

Break-even rises as payroll and overhead grow, even though the margin stays healthy. The lean model clears the bar with the least revenue, while the full model needs steadier retainer and package demand to cover a much bigger cost base.

Planning cases only; these figures are modeled assumptions, not guarantees, and later-year mix math can exceed 100%.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean founder-led model	$21.3k	$5.9k	$15.3k	72%	$0	Lowest break-even bar, before support hiring.
Base staffing model	$29.5k	$8.3k	$21.3k	72%	$0	Main planning case; little cushion until volume ramps.
Full staffing model	$57.8k	$11.6k	$46.3k	80%	$0	Needs steadier retainer and package demand.

What breaks first if demand softens, margins slip, or overhead creeps up?

Stress test

At the base plan, break-even sits near $354,000 a month against $255,000 of fixed costs and a 72% contribution margin. The plan gets fragile fast if cases close slower, retainers get discounted, or overhead jumps before utilization is steady.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$354,000	$0 cushion	Base case leaves no slack.
Revenue shortfall	Monthly revenue runs 10% below plan.	$354,000	$25,000 gap	Slower referrals or fewer closed cases create a monthly hole.
Fixed-cost pressure	Fixed overhead rises 10% to about $280,500 a month.	$389,000	$35,000 gap	Hiring or rent creep pushes the target up fast.
Margin pressure	Variable expenses rise from 28% to 33%.	$381,000	$27,000 gap	Discounts, travel overruns, and outside mediator fees squeeze coverage.
Combined pressure	Revenue is 10% below plan, margin falls to 67%, and overhead is 10% higher.	$419,000	$67,000 gap	The model needs much stronger close rates and pricing discipline to stay whole.

Is this mediation consulting business ready to sign a lease and add recurring overhead?

Founder checklist

Only if the opening pipeline can hold 124 monthly billable hours and the team can carry the $25.5K monthly fixed load. Break-even lands in Month 6, and cash bottoms out in Month 2 at about $839K.

1Booked Hours124 hrs/mo

Before you sign a lease, prove you can keep 124 monthly billable hours booked from local and remote cases; if the pipeline is lighter, the fixed load lands before revenue does.

2Fixed Load$25.5K/mo

This is the monthly base once rent, insurance, software, admin, and founder pay are in place, so bookings have to clear about $25.5K before any bigger office move.

3Contribution Margin72% CM

Year 1 revenue keeps about 72% after online dispute resolution software, external mediator fees, marketing, and client travel, so discounts or extra delivery costs can’t eat that spread.

4Staff Ramp2.0 FTE

With the current staffing plan at 2.0 full-time equivalents, confirm the founder, senior mediator, and admin support can handle booked work before you add more recurring payroll.

5Cash Cushion$839K

Cash needs bottom out in Month 2 near $839K, so fund the ramp before deposits, hardware, and hiring drain the bank.

6Launch Demand50 clients

At $500 CAC and a $25K Year 1 marketing budget, you only buy about 50 clients, so confirm the funnel can fill the calendar and shift toward packages and retainers to cut sales swings.