Break-Even and CLV Basics for Small Businesses
Break-even asks how many units (or dollars) cover fixed costs after variable cost. CLV estimates how much a customer is worth over time. Together they keep pricing conversations grounded in arithmetic you can audit.
Break-even skeleton
Break-even units ≈ fixed costs ÷ (price − variable cost per unit). If contribution margin is zero or negative, no volume fixes the plan—change price or cost first.
CLV skeleton
Simple CLV models multiply average revenue per customer by gross margin and expected lifetime (or divide by churn). They are planning estimates, not valuations or fundraising proof.
A pricing sanity check
Confirm unit economics
Margin or contribution per sale.
Run break-even
See the volume required for your fixed cost load.
Estimate CLV
Especially for subscriptions with retention assumptions you enter.
Compare CAC offline
Acquisition cost is outside these worksheets—bring your own CAC when judging payback.