Margin of Safety Calculator
Measure how far sales can fall before your business reaches its break-even revenue.
Sales cushionExample$25,000
- Margin of safety
- 25%
How to calculate margin of safety
Margin of safety = sales − break-even sales; percentage = margin of safety ÷ sales × 100
A negative result means sales are below break-even. Use revenue figures from the same period and cost model.
Worked example
An illustrative scenario. “Reset to example” restores it in the calculator.
- Actual sales
- $100,000
- Break-even sales
- $75,000
Sales cushion: $25,000
Margin of Safety FAQ
How should I interpret a negative margin of safety?
It is the revenue shortfall to break-even. It does not mean you can reduce sales further without a loss.