Small-Batch Spice Break-Even: $108K Monthly, 590 Jars

Fixed costs $17.6K/mo Rent plus payroll

Contribution margin 81% After variable costs

Break-even revenue $21.6K/mo Monthly sales target

Break-even timing Month 26 Ramp paid back

Break-even calculator

Use this calculator to test monthly revenue, revenue-linked costs, and fixed costs against break-even.

Lean Base Full

Monthly revenue Revenue sets the pool that covers direct costs and overhead. $ Low sales High sales Variable expenses Use direct costs that rise with each dollar of sales, like spice inputs, jars, labels, and shipping. $ Low direct cost High direct cost

Money available to cover fixed costs $29,657 $31,550 revenue - $1,893 variable expenses

Margin ratio

94%

Covers fixed costs

Yes

Fixed monthly costs These are the monthly costs break-even must cover before profit starts. $ Lower overhead Higher overhead

Break-even chart Revenue Total costs

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

Cost classification

Break-even only works if jar-level items move with units and monthly overhead stays fixed. Misclassifying jars, labels, freight, or samples as overhead can make the Month 26 break-even target look easier than it is.

Expense	Cost	Break-Even Treatment	Common Mistake
Raw spice inputs	Variable	Use $0.80 to $1.40 per jar, depending on the spice, in unit contribution margin.	Averaging all spices and hiding margin gaps by SKU.
Premium jar and label printing	Variable	Deduct $0.70 per jar plus $0.15 per label from each sale.	Treating jars and labels as overhead instead of per-unit spend.
Direct grinding and packaging labor	Variable	Deduct $0.25 for grinding labor and $0.20 for packaging labor per jar.	Putting direct labor below the break-even line.
Marketing & Sales Campaigns	Variable	Model at 3.5% of first-year revenue, then use the forecast rate by year.	Budgeting a flat amount when spend is tied to sales.
Shipping & Payment Processing Fees	Variable	Model at 2.5% of revenue in the first year, then use the forecast rate by year.	Forgetting freight and card fees when pricing online orders.
Fixed monthly overhead	Fixed	Include $1,500 rent plus $650 for platform, software, insurance, hosting, and non-production utilities.	Spreading fixed overhead into unit margin too early.
Production utilities allocation	Semi-variable	Use the 0.2% of revenue allocation as the usage-linked production utility load.	Treating production power use like stable office utilities.
Production supervisor salary allocation	Semi-fixed	Use the 0.1% allocation as capacity support that may step up with scale.	Assuming supervision rises smoothly with every jar sold.

How does break-even shift from a lean Year 1 setup to a full Year 5 build?

Scenario table

Break-even rises as you move from lean to full, but the cushion also grows because fixed costs stay below contribution at each step. None of these cases proves demand, so the right setup depends on channel proof and wage load.

Planning cases only; these figures show modeled assumptions, not guaranteed demand or profit.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean Year 1 setup	$11,017	$2,234	$8,608	79.7%	$175	Near break-even, so the margin of safety is thin.
Base Year 3 setup	$31,550	$5,696	$17,567	81.9%	$8,287	Break-even sits near $21.5k, so this case has a solid cushion.
Full Year 5 build	$71,267	$11,614	$20,483	83.7%	$39,170	Break-even sits near $24.5k, so profit scales fast if volume holds.

What breaks the break-even plan for small-batch spices?

Stress test

The base plan has only a thin cushion, so a small sales miss or higher packaging, freight, or ingredient costs can push it negative fast. Combined pressure is the clearest break point.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$10,800	$215 cushion	The plan starts with only a small cushion.
Revenue shortfall	Year 1 revenue drops 10% to about $9,915.	$10,800	$700 gap	A 10% sales dip can turn the month negative.
Fixed-cost rise	Fixed costs rise 10% to about $9,469 a month.	$11,900	$883 gap	Rent or payroll creep pushes break-even above plan.
Margin pressure	Variable expenses rise 10%, cutting contribution margin to about 77.7%.	$11,100	$83 gap	Freight above 2.5% of revenue or jar-plus-label cost above $0.85 tightens the margin.
Combined pressure	Revenue drops 10%, fixed costs rise 10%, and contribution margin falls to about 77.7%.	$12,200	$1,800 gap	Slower repeat orders plus seasonal inventory build create the clearest break point.

Is the spice launch ready before you lock in rent, equipment, and inventory?

Founder checklist

Break-even in Month 26 is not a green light by itself. The launch is ready only if you can clear 590 jars a month, fund the $52,000 build, and keep supply, capacity, and margin intact.

1Demand proof590 jars/mo

Verify you can sell about 590 jars a month before you lock the $1,500 facility rent, because fixed costs only work when demand is real.

2Supplier timing$10K lot

Confirm supplier minimums and that $0.70 jars plus $0.15 labels arrive on time before you commit the $10,000 bulk spice purchase.

3Margin check80-82% CM

Check that each SKU still keeps roughly 80% to 82% contribution margin, the profit left after variable costs, after direct costs and Year 1 marketing and processing fees.

4Capacity rampMonth 7 hire

Verify grinding and packing capacity before you spend $15,000 on equipment, and only add the Production Assistant in Month 7 when volume really needs it.

5Cash cushion$1.013M floor

Plan cash for the $52,000 launch build and the Month 37 cash trough, since Month 26 break-even does not mean the bank balance is safe.

6Launch demandDTC first

Verify direct-to-consumer demand before you add wholesale discounts, and keep shelf life and batch traceability tight as volume rises.