Liquor Store Break-Even Analysis: $257K Monthly Sales Target

Fixed costs $20.7K/mo Monthly overhead

Contribution margin 80.5% After variable costs

Break-even revenue $25.7K/mo Monthly target

Break-even timing Month 20 Model crossover

Break-even calculator

Test how monthly revenue, variable costs, and fixed costs shape break-even for a retail wine and spirits store.

Lean Base Full

Monthly revenue Revenue sets the pool left after direct costs to cover fixed overhead. $ Low sales High sales Variable expenses Use direct product cost, card fees, and promo spend that rise with sales. $ Light costs Heavy costs

Money available to cover fixed costs $60,000 $75,000 revenue - $15,000 variable expenses

Margin ratio

80%

Covers fixed costs

Yes

Fixed monthly costs These are the monthly costs break-even must cover, like rent, payroll, and overhead. $ Low overhead High overhead

Break-even chart Revenue Total costs

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

Cost classification

Your break-even only works if monthly overhead stays separate from sales-linked charges. Fixed rent and Year 1 payroll set the hurdle, while wholesale, inbound freight, card fees, and promotions reduce contribution margin.

Expense	Cost	Break-Even Treatment	Common Mistake
Retail Space Rent	Fixed	Use $4,000 per month as fixed overhead from Month 1 through Month 60.	Scaling rent up or down with weekly traffic.
Payroll	Fixed	Use $15,000 per month in the first year: $60,000 manager, 2.0 associates, 0.5 marketing, and 0.5 product expert FTE.	Treating base staffing as variable per sale.
Product Wholesale Cost	Variable	Apply 15.0% of sales in the first year, falling to 13.0% by the fifth year.	Treating replenishable inventory as fixed overhead.
Shipping & Handling Inbound	Variable	Apply 1.0% of sales in the first year, falling to 0.7% by the fifth year.	Ignoring freight when calculating product margin.
Payment Processing Fees	Variable	Apply 2.0% of sales in the first year, falling to 1.6% by the fifth year.	Using gross sales as if card fees do not exist.
Marketing & Promotions	Variable	Apply 1.5% of sales in the first year, falling to 1.2% by the fifth year.	Budgeting promotions as a flat monthly guess.
Utilities	Semi-variable	Start with the $700 monthly base, then review usage if traffic, refrigeration, or tasting activity rises.	Assuming utility spend stays flat at higher volume.
Licensing, Insurance, Monitoring, Cleaning, Software, and Supplies	Fixed	Use $1,000 per month as recurring overhead: $100 licensing, $250 insurance, $80 monitoring, $300 cleaning, $150 software, and $120 supplies.	Spreading fixed admin overhead across each unit sold.

How does break-even change from a lean to a full wine and spirits store setup?

Scenario table

Lean breaks even near $21.4k a month, base near $25.3k, and full near $28.3k. The weighted ticket rises from $45.75 in Year 1 to $51.38 in Year 3, but bigger payroll still pushes the bar up.

Planning assumptions only; real results can shift with lease terms, sales mix, and traffic.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean Year 1 setup	$21.4k	$4.2k	$17.3k	80.5%	$0	Lowest overhead, but one weak month can slip below break-even.
Base Year 2 setup	$25.3k	$4.8k	$20.6k	81.1%	$0	Midcase needs steadier traffic and basket size to stay above break-even.
Full Year 3 setup	$28.3k	$5.1k	$23.2k	81.9%	$0	Best cushion, but the higher payroll still leaves little room for soft sales.

What pushes this wine and spirits store off break-even?

Stress test

This store needs about $257,000 in monthly revenue to break even, based on an 80.5% contribution margin, which is the share left after product and card costs, against $207,000 of fixed costs. Any traffic dip or margin squeeze hits cash fast.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$257,000	$0 gap	At break-even, any miss turns into loss.
Revenue shortfall	Monthly sales are $25,700 below plan.	$257,000	$25,700 gap	That drop cuts about $20,700 of contribution.
Fixed-cost pressure	Rent or payroll rises by $1,000 a month.	$258,242	$1,242 gap	Small overhead hikes need quick sales lift.
Margin pressure	Variable expenses rise by 1 percentage point.	$260,000	$3,000 gap	Fees, breakage, and discounting move break-even up.
Combined pressure	Fixed costs rise by $1,000 and variable expenses rise by 1 point.	$273,000	$16,000 gap	Two small hits can wipe out the cushion.

What should a wine and spirits founder verify before signing the lease?

Founder checklist

Break-even lands in Month 20, so the opening plan has to survive a long ramp. Before you sign, make sure Year 1 rent, payroll, stock, and launch spend still fit the model; if the store can’t carry the $20.7K monthly fixed load and the $583K cash trough, it’s too thin.

1Lease load$20.7K/mo

Confirm $4,000 rent and $15,000 Year 1 payroll before you sign, because fixed cost is already heavy before product and promo spend.

2Traffic proof850/wk

Test weekday and weekend traffic against the 15.0% visitor-to-buyer rate, because 850 weekly visitors only works if that footfall shows up.

3Margin check80.5% CM

Use Year 1 pricing and cost mix to verify wholesale, inbound freight, processing, and promo still leave about 80.5% contribution margin.

4Crew ramp4.0 FTE

Open with the Year 1 staffing plan, not a Year 3 sales plan, because the model starts at 4.0 full-time equivalent staff and scales later.

5Cash reserve$583K

Keep reserve cash separate from launch spend, since minimum cash falls to $583K in Month 24 and payback takes 32 months.

6Launch spend$173K

Set aside the full $173,000 launch budget, keep the $30,000 starting stock separate from replenishment cash, and have age checks, security, POS at $150 per month, and licensing timing mapped before opening.