Retail Loss Prevention Service Break-Even: $97K/Month

Fixed costs $15.0K/mo Core overhead base

Contribution margin 86% After variable costs

Break-even revenue $17.4K/mo Revenue to cover costs

Break-even timing Month 21 Model crossover point

Break-even calculator

Test monthly revenue, variable expenses, and fixed costs against break-even for a retail loss prevention service.

Lean Base Full

Monthly revenue Revenue creates the pool that pays direct and fixed costs. $ Low sales High sales Variable expenses These direct costs rise as sales rise. $ Light costs Heavy costs

Money available to cover fixed costs $98,527 $113,250 revenue - $14,723 variable expenses

Margin ratio

87%

Covers fixed costs

$9,667 short

Fixed monthly costs This is the overhead break-even has to cover each month. $ Lean overhead Heavy overhead

Break-even chart Revenue Total costs

Which expenses are fixed, and which move with sales in a retail loss prevention service?

Cost classification

Break-even gets reliable only when revenue-linked costs and capacity-step costs are separated from true overhead. In this model, small classification errors can shift the Month 21 break-even target.

Expense	Cost	Break-Even Treatment	Common Mistake
Hardware and Cloud Hosting	Variable	Model at 8% of first-year revenue, falling to 5% by the mature year.	Treating cloud usage as flat.
Sales Commissions and Processing	Variable	Model at 6% of first-year revenue, declining as sales efficiency improves.	Ignoring payment fees and commission drag.
Office Rent	Fixed	Carry $6,000 per month from Month 1 through Month 60.	Signing space before contract coverage supports it.
Cybersecurity Insurance	Fixed	Carry $2,000 per month as baseline operating overhead.	Underpricing compliance and security risk.
Legal and Compliance Fees	Fixed	Carry $3,500 per month for licensing, contracts, and compliance support.	Treating licensing work as optional.
Technical Support Tools	Fixed	Carry $1,500 per month while the current support stack stays in place.	Leaving support software out of overhead.
Customer Support Specialist Payroll	Semi-fixed	Add capacity in steps at $60,000 per full-time employee per year.	Modeling support labor as a straight percentage of revenue.
Sales Director Payroll	Semi-fixed	Add sales leadership in steps at $95,000 per full-time employee per year.	Forgetting headcount jumps when the pipeline grows.

How does break-even change from lean launch to base rollout and full scale?

Scenario table

Break-even shifts because recurring revenue rises, but payroll and marketing step up fast. The lean case stays deep in the red, the base case gets close, and the full case turns positive after Month 21.

Planning assumptions only; actual break-even will move with sales mix, hiring pace, and contract timing.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean launch	$51.1k	$7.2k	$92.0k	86%	-$48.1k	Still below break-even; new contracts must scale faster than overhead.
Base rollout	$113.3k	$14.7k	$108.2k	87%	-$9.7k	Near break-even, but payroll growth still keeps cash tight.
Full scale rollout	$188.6k	$22.6k	$152.5k	88%	$13.5k	Crosses break-even; cushion starts after Month 21.

What breaks the break-even plan for this retail loss prevention service?

Stress test

Base break-even is about $97,000/month on an 86% contribution margin, meaning 86 cents of each sales dollar is left after variable costs, with about $83,000 in fixed cost coverage. A 10% revenue miss, 10% higher overhead, or an 18% variable load can erase the cushion fast.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$97,000/month	$45,900 gap	Year 1 average revenue is still well below break-even.
Revenue shortfall	Revenue drops 10% to $87,300/month.	$97,000/month	$7,500 gap	A small sales miss burns most of the cushion.
Fixed-cost increase	Fixed costs rise 10%.	$106,200/month	$9,200 gap	More overhead needs more sales just to hold even.
Margin pressure	Variable expenses rise from 14% to 18%.	$101,600/month	$4,600 gap	Higher cloud or commission spend cuts contribution fast.
Combined pressure	Revenue drops 10%, variable expenses hit 18%, and fixed costs rise 10%.	$107,000/month	$19,700 gap	Delayed contracts and added support can push the plan into loss.

Can this loss prevention service cover full payroll before you commit to the launch build?

Founder checklist

Don’t lock in the full payroll load until you can hold about $97K in monthly recurring revenue at a $579 weighted monthly contract value. Year 1 CAC is $850, but cash still bottoms out in Month 29 and payback takes 52 months, so runway has to cover the gap.

1Demand Target$97K MRR

Confirm signed recurring contracts reach at least $97K a month before full payroll, because this is the level that makes the operating model believable.

2Margin Mix86% CM

Verify the 40% basic, 35% advanced, and 25% premium mix really prices to $579 a month and still leaves about 86% contribution margin after 8% hardware/cloud and 6% sales commissions and processing.

3CAC Budget$850 CAC

Keep Year 1 customer acquisition cost near $850 and make sure it fits inside the $150K marketing budget before you scale paid demand.

4Fixed Load$70.8K/mo

Do not commit to the $6,000 rent line and the rest of the overhead stack unless signed accounts cover about $70.8K a month, which is $15K fixed expenses plus $55.8K of Year 1 payroll.

5Staffing Ramp1→6 FTE

Stage support hiring because the Customer Support Specialist line rises from 1 FTE to 6 FTE, and each added specialist costs $60K a year.

6Runway CheckMonth 29

Stage the $190K capex build across Months 1 to 7 and keep cash alive through Month 29, where minimum cash reaches -$75K; Month 21 break-even is not Month 52 payback.