POS Systems Break-Even Analysis: About $67K/Month

Fixed costs $37.8K/mo Base overhead

Contribution margin 82% After variable costs

Break-even revenue $46.1K/mo Monthly target

Break-even timing Month 1 Launch month

Break-even calculator

Use this calculator to test monthly revenue, variable expenses, and fixed costs against break-even for a POS systems business.

Lean Base Full

Monthly revenue Revenue sets the cash left to cover fixed costs. $ Low sales High sales Variable expenses These rise with sales, like marketing and cloud support. $ Lean spend Heavy spend

Money available to cover fixed costs $2,841,000 $3,000,000 revenue - $159,000 variable expenses

Margin ratio

95%

Covers fixed costs

Yes

Fixed monthly costs Rent, software, payroll base, and overhead sit here. $ Low base High base

Break-even chart Revenue Total costs

Which expenses stay fixed and which move with sales in this payment terminal business?

Cost classification

Break-even is only useful if fixed overhead is separated from revenue-linked spend. In the first operating year, the key trap is treating hardware, payment fees, and scalable support as free margin.

Expense	Cost	Break-Even Treatment	Common Mistake
CEO, lead software engineer, and sales manager payroll	Fixed	Include as monthly salary burden during the active planning range.	Moving core leadership payroll below the gross margin line.
Customer support specialist staffing	Semi-fixed	Add in steps as support coverage and customer volume rise.	Modeling support as purely variable per account.
Office rent, legal, utilities, insurance, and admin	Fixed	Use $6,200 per month before internal software licenses.	Letting small overhead items disappear from break-even math.
Internal software licenses	Fixed	Use $800 per month from Month 1 through Month 60.	Treating internal tools as one-time setup spend.
Hardware procurement	Variable	Apply 5.0% of first-year revenue, then reduce by year per the model.	Treating hardware fulfillment as free margin.
Payment network fees	Variable	Apply 7.0% of first-year revenue because fees move with processed sales.	Using subscription margin while ignoring transaction fees.
Digital marketing and sales commissions	Variable	Apply 3.5% of first-year revenue for sales-linked acquisition spend.	Counting marketing only as the annual budget.
Annual marketing budget	Semi-fixed	Plan $150,000 in the first year, or about $12,500 per month.	Assuming budget spend flexes perfectly with monthly sales.

How does break-even shift from lean to base to full POS launch?

Scenario table

Lean keeps payroll and admin tight, so break-even lands near $517K a month. Base adds Year 1 marketing, and full adds more staff plus heavier marketing, so the revenue needed to cover fixed costs climbs fast.

Planning assumptions only; break-even will move with mix, pricing, and sales pace.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean launch	$517K	$93K	$424K	82.0%	$0	Lowest fixed load, so the break-even bar is the easiest to clear.
Base launch	$670K	$121K	$549K	82.0%	$0	Marketing adds fixed pressure, so the cushion tightens but stays fundable.
Full rollout	$1.20M	$190K	$1.01M	84.2%	$0	Highest fixed load, so it needs the deepest sales pipeline and fastest scale.

What breaks the break-even plan if sales slow or costs creep up?

Stress test

The plan is only safe if sales hold, customer acquisition cost (CAC) stays below $100, and trial-to-paid stays above 40%. A 10% revenue miss or a 10% fixed-cost bump each opens about a $55,000 monthly gap.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change; monthly revenue stays at $670,000 and contribution margin stays at 82%.	$670,000	$0 cushion	No cushion; CAC must stay under $100 and trial-to-paid above 40%.
Revenue shortfall	Monthly revenue drops 10% to $603,000.	$670,000	$54,000 gap	A 10% sales miss creates a monthly funding hole.
Fixed-cost pressure	Fixed costs rise 10% to $604,000.	$737,000	$55,000 gap	Higher payroll or overhead pushes break-even out of reach.
Margin pressure	Variable expenses rise from 18% to 23%.	$713,000	$33,000 gap	Payment fees above 7% or hardware over 5% squeeze margin.
Combined pressure	Revenue drops 10%, fixed costs rise 10%, and variable expenses rise to 23%.	$784,000	$140,000 gap	Lower sales, higher fees, and stretched support capacity stack fast.

What must the founder verify before committing to the POS build and hiring plan?

Founder checklist

Before you add staff, hardware, or space, test whether the funnel can reach the revenue path, the Year 1 cost base fits the cash plan, and the reserve can absorb a slow launch. Break-even in Month 1 is a checkpoint here, not proof the business is safe.

1Revenue Path$670K/mo

Verify recurring demand can climb to the monthly revenue path before you lock in bigger commitments.

2Funnel Proof5.0% / 40.0%

Verify Year 1 marketing at $150K can hold a $100 CAC with 5.0% visitor-to-trial and 40.0% trial-to-paid conversion.

3Fixed Load$42.4K/mo

Verify Year 1 payroll plus fixed overhead stays inside the cash plan before you hire beyond the first operating year.

4Margin Check82.0% CM

Verify the Year 1 variable load stays near 18.0% of revenue, with payment network fees near 7.0%, so contribution margin stays at 82.0%.

5Support Ramp1.0 to 3.0 FTE

Verify support can scale from 1.0 FTE in Year 1 to 3.0 FTE in Year 5, and delay office, warehouse, or inventory expansion until subscriptions cover the load.

6Cash Cushion$2.3M

Verify you have at least the minimum cash need of $2.3M, because the break-even month is only a checkpoint if launch timing slips.