Reseller Business Break-Even: About $335K In Monthly Sales

Fixed costs $4.1K/mo Base overhead

Contribution margin 80% After variable costs

Break-even revenue $5.1K/mo Revenue target

Break-even timing Month 3 Modeled break-even

Break-even calculator

Test how monthly revenue, variable expenses, and fixed monthly costs work together to show the reseller's break-even point.

Lean Base Full

Monthly revenue Revenue is the cash you have left to cover overhead after direct costs. $ Lower sales Higher sales Variable expenses Direct costs rise with each sale, like product buys, shipping, and card fees. $ Lower direct costs Higher direct costs

Money available to cover fixed costs $28,400 $35,500 revenue - $7,100 variable expenses

Margin ratio

80%

Covers fixed costs

Yes

Fixed monthly costs These are the monthly costs your margin has to cover before profit starts. $ Lower overhead Higher overhead

Break-even chart Revenue Total costs

Which reseller expenses are fixed, and which move with sales?

Cost classification

Break-even only works if variable expenses reduce contribution margin and fixed expenses sit in monthly overhead. Here, the first-year model reaches break-even in Month 3, so misclassifying even small fees can distort that timing.

Expense	Cost	Break-Even Treatment	Common Mistake
Product Purchase Cost	Variable	Use 12.0% of revenue in the first year as product COGS before contribution margin.	Treating inventory buys as profit before stock has sold.
Inbound Shipping and Handling	Variable	Use 1.5% of revenue in the first year and include it in gross margin math.	Leaving freight out of landed product margin.
Payment Processing Fees	Variable	Use 2.5% of revenue in the first year for card and checkout fees.	Ignoring fees on repeat orders and refunds.
Fulfillment and Outbound Shipping	Variable	Use 4.0% of revenue in the first year because it moves with shipped orders.	Using retail price before delivery expense.
Online Marketing Budget	Semi-variable	Model the $80,000 first-year budget, then test volume using $25 CAC.	Assuming ad spend scales cleanly with every new customer.
Platform, Software, Insurance, Rent, Admin, and Accounting	Fixed	Use $3,100 per month as baseline overhead from Month 1 through Month 60.	Undercounting the monthly bills needed to stay open.
3PL Management Fee	Semi-fixed	Use the $1,000 monthly base fee, then review capacity before higher volume.	Assuming outsourced storage and handling are free to scale.
Payroll	Fixed	Use about $16,042 per month in the first year, including the founder and part-time managers.	Leaving founder salary outside break-even.

How does break-even shift across lean, base, and full reseller cases?

Scenario table

Break-even shifts mainly with revenue, because fixed cost stays at $268K a month. Lean tests cash risk, base tests launch viability, and full scale tests whether inventory and fulfillment can keep up.

Planning assumptions only; actual results will move with mix, pricing, and order flow.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean launch	$268K	$54K	$268K	80%	-$54K	Cash burn is still wide, so more funding is needed before break-even.
Base case	$335K	$67K	$268K	80%	$0	Operating profit is near zero, so this is the launch viability check.
Full scale	$402K	$80K	$268K	80%	$54K	This adds cushion, but inventory and fulfillment must keep pace.

What breaks the break-even plan for this reseller business?

Stress test

The plan has little cushion, so a small sales dip or a cost bump can tip it below break-even. The main risks are slower sell-through, higher freight and fees, and fixed costs moving up before repeat orders improve.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$335K	$0 cushion	No cushion, so small misses matter.
Revenue shortfall	Revenue falls 10% to $302K.	$335K	$33K gap	Slower sell-through opens a gap fast.
Fixed-cost increase	Fixed costs rise 10% to $295K.	$369K	$34K gap	Extra payroll or overhead lifts the break-even line.
Margin pressure	Variable expenses rise from 200% to 250%.	$357K	$22K gap	Higher freight or fees cut contribution.
Combined pressure	Revenue falls 10%, variable expenses rise to 250%, and fixed costs rise 10%.	$371K	$69K gap	This combination puts the model well below break-even.

Can you prove this reseller covers margin, cash timing, and fulfillment load before you commit to inventory and space?

Founder checklist

The business is ready only if Year 1 demand reaches about 258 orders a month at a $129.80 AOV and the 80% contribution margin (CM) covers the $26.8K monthly fixed load at break-even. Keep cash for the $864K trough in Month 2 before you buy more stock or add hires.

1Wholesale access80% CM

Verify supplier pricing and product access can hold the Year 1 mix at about 80% contribution margin after product cost, inbound freight, processing, and outbound shipping, and set a return policy now because returns are not modeled.

2Inbound freight1.5%

Keep inbound shipping near 1.5% of revenue, or the break-even math slips and each inventory buy gets harder to fund.

3Fixed load$26.8K/mo

Before signing space, confirm the Year 1 fixed load stays near $26.8K per month, including base overhead, the $10K monthly founder salary, part-time ops, part-time marketing, and the $80K annual marketing budget.

4Break-even orders258/mo

Do not scale inventory until you can sell about 258 orders a month at a $129.80 AOV, because that is the model's break-even volume.

5Cash trough$864K

Protect cash for the Month 2 trough, since the model's minimum cash need is $864K and payback does not hit until Month 13.

6Hire rampMonth 13

Delay the Customer Service Specialist and Product Curator until Month 13, when both roles start at 0.5 FTE and the order load can support the added payroll.