Travel Agency Break-Even: About $825K Monthly Revenue

Fixed costs $45.6K Monthly base

Contribution margin 80.5% After variable costs

Break-even revenue $56.6K Monthly target

Break-even timing Month 3 Model timing

Break-even calculator

Use this to see if monthly revenue covers variable costs and fixed overhead, and how far you are from break-even.

Lean Base Full

Monthly revenue Revenue sets the pool that pays variable costs and overhead. $ Low sales High sales Variable expenses These are direct costs that rise with bookings and sales volume. $ Low costs High costs

Money available to cover fixed costs $78,900 $98,000 revenue - $19,100 variable expenses

Margin ratio

81%

Covers fixed costs

Yes

Fixed monthly costs This is the monthly overhead the business must cover before profit. $ Lean overhead Heavy overhead

Break-even chart Revenue Total costs

Which travel agency expenses are fixed, variable, or scale in steps before break-even?

Cost classification

Break-even is only useful if each expense lands in the right bucket. Put payment fees, hosting, and commissions below contribution margin; keep rent and core overhead in fixed costs.

Expense	Cost	Break-Even Treatment	Common Mistake
Office Rent	Fixed	Use $5,000 per month in fixed overhead from Month 1 through Month 60.	Spreading rent across bookings and hiding the real monthly hurdle.
Utilities & Internet	Fixed	Use $800 per month as fixed overhead for the relevant planning range.	Treating basic office connectivity as order-driven spend.
Legal & Accounting Fees	Fixed	Use $1,500 per month in fixed operating overhead.	Leaving recurring professional fees out of break-even math.
CEO, Head of Engineering, and Head of Marketing salaries	Semi-fixed	Model the first-year leadership payroll as a capacity step, not per booking.	Dividing executive salaries by orders and calling them variable.
Payment Processing Fees	Variable	Deduct as a revenue-linked expense: 9.5% in the first year, falling to 4.0% by the mature year.	Burying processing fees inside fixed overhead.
Platform Server Hosting	Variable	Deduct as usage-linked platform expense: 2.0% in the first year, falling to 0.6% by the mature year.	Calling all hosting fixed when usage rises with bookings.
Affiliate Commissions	Variable	Deduct from contribution margin: 6.0% in the first year, falling to 2.0% by the mature year.	Including sales commissions in fixed overhead and overstating margin.
Buyer and seller acquisition budgets	Semi-variable	Model planned annual spend separately from unit acquisition cost: buyer CAC starts at $20, seller CAC starts at $500.	Treating the full marketing budget as fixed while ignoring volume-based acquisition economics.

How do lean, base, and full booking mixes change break-even for a travel agency?

Scenario table

The lean case stays well below the break-even line, the base case is only slightly above it, and the full case adds a real cushion. Fixed costs are about $664k a month, so small swings in bookings matter.

Planning-case figures only; they are assumptions, not guarantees.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean booking mix	$644k	$126k	$664k	80.4%	-$146k	Still below break-even; risk stays high.
Base booking mix	$858k	$167k	$664k	80.5%	$27k	Sits just above break-even with a thin cushion.
Full booking mix	$1,073k	$209k	$664k	80.5%	$199k	Creates a comfortable cushion above break-even.

What breaks this travel agency break-even plan?

Stress test

The plan is most fragile on paid demand and margin. A 15% revenue drop, a $10k monthly overhead jump, or commission pressure below 15% can wipe out the cushion; the combined case opens about a $214k monthly gap.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$858k	$0 cushion	Base case works if buyer CAC stays under $20.
Revenue shortfall	Monthly revenue falls 15%.	$807k	$78k gap	Paid marketing above $208k monthly can push this red.
Fixed-cost rise	Fixed costs rise by $10k per month.	$931k	$73k gap	Extra overhead eats the whole cushion fast.
Margin pressure	Variable expenses rise from 195% to 245%.	$874k	$16k gap	Commission below 15% or higher refunds turn this negative.
Combined pressure	Revenue falls 15%, fixed costs rise $10k, and variable expenses rise to 245%.	$1.07m	$214k gap	This is the break point: weak mix plus cost drift breaks the model.

What should you verify before you sign the lease and fund the first hiring wave?

Founder checklist

Do not lock in the $5,000 lease or the first hires until customer acquisition cost (CAC) is near $20 and seller CAC is near $500. If those costs run higher, the model burns cash before break-even can catch up.

1Demand Proof$20 / $500 CAC

Validate buyer CAC near $20 and seller CAC near $500 before you spend on the lease, because demand has to show up cheaper than your fixed cost.

2Fixed Load$50.6K/mo

The monthly floor is about $50.6K from the $5,000 lease, $10,600 of fixed overhead, and $35K of Year 1 leadership payroll, so only sign if bookings can carry that load.

3Margin Test80%+

Keep contribution above 80% after commissions, payment fees, affiliate costs, and SEO, and watch refunds and cancellations weekly so margin does not slip before payroll grows.

4Hiring RampMonth 13

Delay the first nonfounder hires until the booking flow and support coverage work, because the model does not add the software engineer and customer support specialist until Month 13.

5Cash Cushion$812K

Keep cash above the Month 2 low point of about $812K and stage the $235K startup build, or early spend can crowd out the runway you need to reach break-even.

6Supply CoverageFlights / Hotels / Tours

Confirm you can source and confirm all three lanes before launch, because Year 1 mix starts at 40% flights, 35% hotels, and 25% tours and gets hotel-heavy later.