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Margin Of Safety (Sales) Calculator

Work out margin of safety (sales) instantly with clear inputs, formula shown and shareable results.

About Margin Of Safety (Sales) Calculator

Margin of safety is the cushion between current sales and the break-even point. Expressed as a percentage it tells you how far revenue can fall before the business starts making a loss, which is the single most useful sensitivity figure for an operating plan.

Formulas

Margin of safety

Margin of safety = Actual sales - Break-even sales

As a percentage

MoS % = (Actual sales - Break-even sales) / Actual sales x 100

Worked example

With the default values below, Margin Of Safety (Sales) Calculator returns Margin of safety of 28.00%. Change any input above and every figure here is recalculated in your browser.

Inputs used

Actual (or budgeted) sales
1,250,000
Break-even sales
900,000

Results

Margin of safety
28.00%
Margin of safety (value)
$350,000.00
Break-even as % of sales
72.00%
Sales fall absorbed before a loss
$350,000.00

Step by step

  1. 1Values used
  2. 2Margin of safety
  3. 3As a percentage
  4. 4Margin of safety= 28.00
  5. 5Margin of safety (value)= 350,000.00
  6. 6Break-even as % of sales= 72.00
  7. 7Sales fall absorbed before a loss= 350,000.00

Assumptions and limits

  • The result is derived only from the 2 inputs listed above. Anything not among them is not part of the calculation.
  • In particular, this calculator does not take inflation, tax, fees or charges or compounding frequency into account.
  • Figures are rounded for display to 2 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
  • This is an estimate for general information and not professional financial, tax or legal advice. See the full disclaimer for the limits that apply to this kind of calculator.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

What is a healthy margin of safety?

Above roughly 30% is comfortable for most trading businesses; below 10% means a small demand shock pushes you into losses and fixed costs need attention.

Can I use units instead of sales value?

Yes. The same subtraction works on units, and the percentage is identical provided selling price is constant across the range.

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