Working out your break-even
Your break-even is the number of sales at which the money coming in equals the costs of the pitch. Divide the total cost of the day by the profit you keep on each sale after the cost of the item. The answer is the number of sales you need.
What break-even means for a trader
Break-even is the point where a pitch stops costing you money. Below it you make a loss on the day. Above it every extra sale adds to your profit. Knowing the figure before you book helps you decide whether an event is worth the fee.
The sum needs only a calculator and an honest list of costs. It is most useful when you are choosing between two events with different fees, or deciding whether to take a second pitch at the same market.
List your fixed costs for the day
Fixed costs are the ones you pay however many items you sell. Typical examples are the pitch fee, fuel, parking, insurance cost spread across the day, any staff pay and hire of equipment.
Add them up for one event. The guide to pitch fees helps you check the biggest figure first.
Work out the profit on each sale
Take your selling price and subtract the cost of the item and any charge that applies to each sale, such as a card payment fee. What is left is the contribution each sale makes towards your fixed costs.
If you sell several products at different prices, use an average contribution across your usual mix of sales. Your records from earlier events give a realistic average to work with.
The break-even formula
Break-even number of sales equals total fixed costs divided by the contribution from each sale. To turn that into takings, multiply the number of sales by your average selling price.
Worked example with made-up numbers
This is an example only, using round numbers that are not real prices. Suppose your fixed costs for the day are £100. You sell an item for £10 and it costs you £4, so each sale contributes £6. Divide £100 by £6 and you need just under 17 sales, so you would plan for 17.
At an average price of £10, those 17 sales are £170 of takings. Anything above that is profit before tax.
Compare break-even with realistic footfall
Ask the organiser or regular traders about typical attendance and how many stalls compete for it. If your break-even needs more customers than you can realistically serve in the hours open, choose another event or lower your costs.
Our guide to pricing for different event types shows how takings vary.
Recalculate when costs change
Redo the sum when the pitch fee, stock price or payment charges change. Keep each event's figures in a simple spreadsheet so you can compare them across the season.
A margin of safety is useful too. Aim to reach break-even well before the end of the day, so that bad weather, a slow morning or a supply problem does not turn the pitch into a loss.
Frequently asked questions
How do I calculate break-even for a market stall?
Add up the fixed costs for the day, then divide by the amount each sale contributes after the cost of the item. The result is the number of sales needed to cover the day.
Does break-even include my own wages?
It can. Many traders add a sum for their own time so that a break-even day also pays them. Decide on a figure and apply it consistently.
What if I never reach break-even at an event?
Look at the pitch fee, your prices and your stock mix. If none of them can change enough, consider a different event. A few test pitches give you real figures to work from.
Should break-even include tax?
Break-even covers the costs of the pitch. Tax is calculated on profit across your business, so keep records and check GOV.UK for how it applies to you.
Gazebos built for regular pitches
Once a pitch is confirmed, the stall needs to fit it. Gala Tent makes market stall gazebos for traders who set up week after week.
Useful pages on our sister sites
Event Industry Trader is published by Gala Tent. These pages from Gala Tent and the wider Gala group go further on the kit, branding and payments covered here.
Where to check the rules
Rules vary by council and by event. Confirm requirements with the organiser and the relevant authority before you act.