Medical Simulation Training Break-Even at $808K Monthly Revenue

Fixed costs $66.7K/mo Launch base

Contribution margin 82.5% After variable costs

Break-even revenue $80.8K/mo Monthly target

Break-even timing Month 1 Launch month

Break-even calculator

Use this to test monthly revenue, variable expenses, and fixed costs against break-even for a medical simulation training business.

Lean Base Full

Monthly revenue Revenue is the cash in that helps cover fixed costs after direct costs. $ Low sales High sales Variable expenses Use direct costs like sales commissions and payment fees that rise with revenue. $ Light costs Heavy costs

Money available to cover fixed costs $104,833 $115,833 revenue - $11,000 variable expenses

Margin ratio

91%

Covers fixed costs

Yes

Fixed monthly costs Use the monthly cost base for rent, payroll, and overhead that profit must cover. $ Lower overhead Higher overhead

Break-even chart Revenue Total costs

Which medical simulation training expenses are fixed, and which move with sales?

Cost classification

Break-even is only reliable if fixed costs stay fixed and revenue-linked fees move with sales. In the first year, core salaries and monthly overhead set the hurdle; hosting, licensing, commissions, and processing reduce contribution margin.

Expense	Cost	Break-Even Treatment	Common Mistake
Office Rent	Fixed	Include $5,000 per month in the fixed monthly break-even base.	Flexing rent with access seats before the lease or space changes.
Software Subscriptions	Fixed	Include $1,500 per month as stable overhead for the planning range.	Treating a flat subscription stack as a per-user charge.
Insurance	Fixed	Include $1,200 per month in fixed operating overhead.	Moving insurance up and down with each training session.
Core Launch Salaries	Fixed	Use about $53,958 per month in the first year before benefits or payroll taxes.	Treating salaried launch staff as variable labor.
Cloud Hosting & Data Storage	Variable	Deduct 5.0% of first-year revenue before calculating contribution margin.	Modeling hosting as fixed while access seats and usage rise.
Third-Party Content Licensing	Variable	Deduct 3.0% of first-year revenue as volume-linked content expense.	Burying licensing inside fixed software subscriptions.
Sales Commissions	Variable	Deduct 8.0% of first-year revenue from each sale or booked access plan.	Treating commissions like fixed payroll.
Added Support, Engineering, Curriculum, and Sales FTEs	Semi-fixed	Add headcount in steps as access seats, custom work, and support load outgrow current capacity.	Smoothing future hires as a clean percentage of revenue.

How does break-even shift from a lean launch to a full-scale training model?

Scenario table

Monthly break-even gets easier as occupancy rises and higher-priced access tiers fill the schedule. Custom scenario projects are counted in monthly revenue here, so fixed team and platform costs spread across a much larger base.

Planning assumptions only; actual results will vary with sales mix, staffing, and client demand.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean launch case	$125k	$21.9k	$66.7k	82.5%	$36.5k	Break-even is covered, but cushion is light.
Base growth case	$670k	$90.5k	$119.8k	86.5%	$459.8k	This is the cleanest break-even cushion in the set.
Full scale case	$1.66m	$157.2k	$174.8k	90.5%	$1.32m	Best scale effect; break-even risk is lowest.

What breaks the break-even plan if contracts slip or recurring costs rise?

Stress test

The plan starts with about $365K of cushion, but it narrows fast if revenue slips or software and staffing costs move up. A 20% revenue drop leaves about $158K; the combined case leaves only about $8K.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$809K	$365K cushion	Healthy, but the buffer is not wide.
Revenue shortfall	Revenue drops 20% to $1.0M.	$809K	$158K cushion	One missed contract cycle cuts the buffer fast.
Fixed-cost pressure	Overhead rises 15% to $767K.	$930K	$265K cushion	Payroll, rent, and tools can outrun sales.
Margin pressure	Variable expenses rise to 22.5% of revenue.	$861K	$302K cushion	Margin compression makes each deal less forgiving.
Combined pressure	Revenue drops 20%, variable expense hits 22.5%, and fixed costs rise 15%.	$989K	$8K cushion	One more miss puts the plan at the edge.

Is the demand, staffing, and cash in place before you lock the lease and buy the equipment?

Founder checklist

Do not lock the lease or buy the equipment until signed demand clears the break-even line. With Year 1 revenue at $125K a month, 17.5% direct costs, and about $66.7K a month in fixed load plus payroll, the business breaks even at roughly $80.8K a month.

1Demand proof$125K/mo

Verify signed or near-signed Basic, Pro, Enterprise, and Custom Scenario Projects can support the Year 1 revenue plan before you spend on the build.

2Fixed load$12.7K/mo

Check that rent, utilities, software, insurance, legal and accounting, admin supplies, and professional development stay near $12.7K a month, with rent at $5K and utilities at $800, before you sign the lease.

3Contribution82.5% CM

Verify cloud hosting, content licensing, sales commissions, and payment fees stay at 17.5% of revenue, because that leaves 82.5% to fund payroll and overhead.

4Staffing ramp$647.5K/yr

Confirm the 5.5 FTE Year 1 team can cover delivery without pushing occupancy below 40%, or onboarding delays and instructor bottlenecks will hit revenue fast.

5Launch capex$415K

Stage the $150K hardware, $100K manikins, $50K workstations, $30K office setup, $20K software licenses, $40K prototyping gear, and $25K demo kits before full rollout.

6Cash floor$1.729M

Keep the opening cash buffer at or above the model’s $1.729M minimum, because Month 1 spend lands before occupancy ramps and low occupancy can drain cash fast.