Time And Motion Study Consulting Break-Even: About $85K/Month

Fixed costs $12.1K/mo Core overhead

Contribution margin 79.5% After variable costs

Break-even revenue $15.2K/mo Monthly target

Break-even timing Month 10 Ramp point

Break-even calculator

Test monthly revenue against variable expenses and fixed costs to see where break-even lands.

Lean Base Full

Monthly revenue Enter monthly sales before direct costs. $ Low sales High sales Variable expenses Include travel, software, and sales costs that rise with work. $ Low direct costs High direct costs

Money available to cover fixed costs $112,379 $139,083 revenue - $26,704 variable expenses

Margin ratio

81%

Covers fixed costs

Yes

Fixed monthly costs Include monthly overhead the business must cover. $ Light overhead Heavy overhead

Break-even chart Revenue Total costs

Which expenses are fixed, and which move with client work in this consulting model?

Cost classification

Break-even gets reliable when steady overhead is kept separate from costs tied to billable work. Rent and insurance set the monthly floor; travel, software use, commissions, and client materials move with revenue.

Expense	Cost	Break-Even Treatment	Common Mistake
Headquarters Office Lease, $6,500/month	Fixed	Include as monthly overhead before contribution margin.	Treating rent as if it rises with each project.
Professional Liability Insurance, $1,200/month	Fixed	Include as recurring overhead across the planning range.	Dropping insurance from break-even because it is not project labor.
Accounting and Legal Retainer, $2,500/month	Fixed	Keep in fixed overhead for every operating month.	Only adding it during contract-heavy months.
Project Specific Travel and Lodging, 10.0% of first-year revenue	Variable	Deduct from revenue before calculating contribution margin.	Budgeting travel as flat overhead despite site-visit volume.
Cloud Computing and Analytics Licenses, 4.0% of first-year revenue	Variable	Model as delivery usage tied to client analysis work.	Putting all software spend into fixed overhead.
Sales Commissions and Lead Referrals, 5.0% of revenue	Variable	Subtract as a sales-volume charge before break-even.	Ignoring commissions when pricing new consulting projects.
Planned Marketing Budget, $45,000 in the first year	Semi-fixed	Treat as a planned spend that can step up by year.	Modeling marketing as a perfect percentage of sales.
Analyst and Engineering Payroll once hired	Fixed	Count salary as fixed overhead after each role starts.	Calling payroll variable just because consultants are billable.

How does break-even change from a lean launch to a fuller-service consulting model?

Scenario table

Here’s the quick read: the lean and base setups carry the same revenue load, but higher staffing pushes fixed costs up faster than contribution. The fuller model only works once the Year 2 volume is in place.

Planning assumptions only; actual break-even will move with project mix, staffing, and billable hours.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean solo-plus-team launch	$66,250	$13,581	$60,383	79.5%	-$7,714	Still below break-even, so overhead stays tight.
Staffed base launch	$66,250	$13,581	$67,883	79.5%	-$15,214	Same revenue, but the added staff load widens the gap.
Larger fieldwork model	$139,100	$26,707	$87,300	80.8%	$25,093	Year 2 volume clears break-even and leaves a cushion.

What pushes this consulting plan past break-even?

Stress test

The base case already sits about $19.1k a month below break-even. A 15% revenue miss, 10% fixed-cost creep, or 5-point margin pressure quickly widens the gap, and the combined case pushes the monthly shortfall to about $43.9k.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	Base case; no change in pricing, mix, or costs.	$85,400	$19,100 gap	Still below break-even by about $19.1k a month.
Revenue shortfall	Monthly revenue slips 15% to about $56,300.	$85,400	$29,100 gap	One delayed engagement adds about $10k to the monthly hole.
Fixed-cost increase	Fixed overhead rises 10% to about $74,700 a month.	$94,100	$27,850 gap	Overhead creep pushes the break-even target higher fast.
Margin pressure	Variable expenses rise 5 points to 25.5% of revenue.	$91,100	$24,850 gap	Travel and license inflation eat into the cushion.
Combined pressure	Revenue slips 15% and fixed overhead rises 10% while margin weakens.	$100,200	$43,900 gap	This is the danger zone: the monthly gap more than doubles.

Can the founder prove enough work to cover the first fixed-cost lock-in?

Founder checklist

Before you lock the lease, hires, and equipment, make sure signed or late-stage work can cover the $85,400/month base break-even revenue. If the pipeline is thin, delay fixed costs and stage spend until pricing, utilization, and cash all line up.

1Signed pipeline$85.4K/mo

Confirm current signed or late-stage work can cover the base break-even load before you add more fixed cost.

2Lease timing$6.5K/mo

Delay the $6,500 monthly office lease until utilization is clear, and set travel approval rules before the 10.0% project travel cost line starts squeezing margin.

3Rate floor$175-$310/hr

Check that each service line clears its own rate floor before discounting, because the mix has to support break-even, not just billable hours.

4Customer load45 hrs/customer

Make sure each active customer can absorb about 45 billable hours per month in Year 1, or the team will hit a delivery ceiling before revenue grows.

5Payroll ramp$52.1K/mo

Stage the business development role and support hires so payroll stays aligned with signed work; the listed team runs about $52,100 per month in Year 1.

6Cash floor$440K

Hold the $440,000 minimum cash buffer, keep Year 1 marketing at $45,000 with customer acquisition cost (CAC, the cost to win one customer) near $4,500, and phase the $231,000 software, equipment, and vehicle stack before Month 17.