Physiotherapy Clinic Break-Even Analysis: $456K/Month

Fixed costs $42.6K/mo Year 1 base

Contribution margin 52% After variable costs

Break-even revenue $82.4K/mo Monthly target

Break-even timing Month 26 Model crossover

Break-even calculator

Test whether monthly revenue covers variable expenses and the fixed cost base for a physiotherapy clinic.

Lean Base Full

Monthly revenue Revenue sets the margin left to cover fixed clinic costs each month. $ Lower volume Higher volume Variable expenses These are direct costs that move with clinic activity and billing volume. $ Lower direct cost Higher direct cost

Money available to cover fixed costs $90,000 $95,000 revenue - $5,000 variable expenses

Margin ratio

95%

Covers fixed costs

Yes

Fixed monthly costs This is the monthly overhead that contribution margin must cover. $ Tighter overhead Heavier overhead

Break-even chart Revenue Total costs

Which physiotherapy clinic expenses are fixed, and which move with treatment volume?

Cost classification

Break-even gets unreliable when fixed overhead is treated like visit-level spend, or variable fees are ignored. Here, rent and core systems set the monthly floor, while supplies and billing fees reduce contribution margin.

Expense	Cost	Break-Even Treatment	Common Mistake
Clinic Rent	Fixed	Include the $5,000 monthly amount in overhead before calculating required treatments.	Don’t tie rent to visits or reduce it when utilization is low.
EHR Software Subscription	Fixed	Include the $500 monthly subscription before revenue.	Don’t treat the system as a per-treatment charge.
Professional Liability Insurance	Fixed	Include the $300 monthly premium as required clinic overhead.	Don’t leave out recurring insurance drag.
Medical Supplies	Variable	Apply the first-year 1.0% rate against treatment revenue.	Don’t bury treatment supplies inside general office supplies.
Therapeutic Consumables	Variable	Apply the first-year 0.5% rate as treatments are delivered.	Don’t assume each visit has zero consumable spend.
Payment Processing Fees	Variable	Reduce contribution margin by the 2.0% processing fee.	Don’t calculate break-even on gross revenue alone.
Billing Service Fees	Variable	Use the first-year 3.0% fee to reflect collections friction.	Don’t miss the drag from billing and payer handling.
Staff Physical Therapist	Semi-fixed	Add the $90,000 annual salary in capacity blocks as visit demand supports it.	Don’t add full-time staff before treatment volume fills the schedule.

How does break-even change from a lean launch to a base case and a full clinic build?

Scenario table

As staffing, visit volume, and pricing rise, revenue grows faster than costs. The lean setup stays in the red, the base case reaches break-even, and the full build creates the widest cushion.

Planning case figures use model assumptions and can move with payer mix, utilization, and hiring pace.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean launch (Year 1)	$38.2k	$2.5k	$42.6k	93.5%	-$6.9k	Still below break-even; payroll pressure outweighs revenue.
Base case (Year 3)	$113.9k	$7.4k	$90.1k	93.5%	$16.4k	Just over break-even, so the cushion is thin.
Full build (Year 5)	$222.7k	$14.9k	$114.0k	93.3%	$93.8k	Wide cushion; the main risk shifts to capacity use.

What breaks the break-even plan for a physiotherapy clinic?

Stress test

The Year 3 plan has about a $264k monthly cushion, but slower referrals, higher no-shows, and wage or rent pressure can shrink it fast. If revenue falls 10% and costs rise 10%, the cushion drops to about $57k.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	Year 3 base forecast holds steady.	$875k	$264k cushion	Comfortable, but not wide.
Revenue shortfall	Revenue drops 10% from the Year 3 base case.	$868k	$157k cushion	Slower referrals cut the buffer quickly.
Fixed-cost pressure	Fixed payroll and overhead rise 10%.	$956k	$183k cushion	Rent and wage inflation compress room to absorb shocks.
Margin pressure	Variable expenses rise from 65% to 85%.	$898k	$241k cushion	Higher billing fees and no-shows erode contribution.
Combined pressure	Revenue drops 10%, fixed costs rise 10%, and variable expenses rise to 85%.	$968k	$57k cushion	One bad quarter gets you close to break-even.

Can this clinic cover fixed costs before you sign the lease and start build-out?

Founder checklist

Here’s the quick math: don’t sign the lease or start build-out until the clinic can cover a $456K monthly break-even run rate. You also need $525K cash by Month 25 and a clear path to more than $382K a month after launch.

1Break-even$456K/mo

Verify referral volume and visit mix can support the monthly fixed load before you sign the lease or spend on build-out.

2Lease load$5.8K/mo

Check that rent at $5,000 and utilities at $800 stay workable, because those costs start on day one.

3Fee drag30% + 20%

Stress test billing fees at 30% and payment fees at 20% so contribution margin still covers overhead.

4Therapist ramp140-150/mo

Match each Staff PT to 140 to 150 monthly treatments, and delay specialty hiring until the model can carry the $100K salary.

5Cash cushion$525K

Keep this reserve through Month 25, since the model’s minimum cash point arrives there and the $166K startup capex lands first.

6Launch target$382K/mo

Do not commit to the full launch plan unless referral flow can move revenue above this level quickly after opening.