Minimum Order Quantity: Break-Even and Target Profit
Breaking even and earning a chosen job profit are different thresholds. A minimum order can reflect either, but the calculation needs a stated selling price and cost model.
Start with contribution per finished shirt
Subtract variable cost per shirt from selling price. The difference is available to cover fixed job cost, then contribute to profit. At a $12 selling price and $5 variable cost, contribution is $7.
With $140 fixed cost, the break-even calculator gives 140 ÷ 7 = 20 shirts. At 20 shirts, revenue and modeled cost are equal. That does not provide a profit allowance for the job.
Add a target amount, not a second percentage
If the desired job profit is $210 under this model, add that amount to fixed cost before dividing by contribution:
Here, ($140 + $210) ÷ $7 = 50 shirts. Revenue is $600; variable cost is $250; fixed cost is $140; profit is $210. At 49 shirts, profit is $203, so the rounded threshold matters.
This is a target dollar amount, not a margin percentage. To price a known quantity for a target margin, use the job pricing calculator instead of treating the two targets as interchangeable.
Check the conditions before trusting the threshold
The formula needs positive contribution and assumes the selling price and variable cost stay constant across the quantity range. If the unit price changes at a discount tier, recalculate that tier separately. If another production session adds setup, update fixed cost too.
A larger order is not guaranteed to meet a profit target when price falls or cost rises. The quantity-discount example shows why a change in volume and a change in unit price must be considered together.
A commercial minimum can include other constraints
The arithmetic threshold does not settle scheduling, garment-pack quantities, customer expectations, or the administrative effort of a small job. A shop may choose a larger minimum or a minimum job charge, but it should understand the reason rather than presenting the mathematical threshold as a universal rule.
If a small order is accepted during otherwise idle capacity, the short-term decision may differ from the policy used when the press is full. Compare contribution per constrained press hour when capacity is the issue.
Keep the assumptions with the minimum
Record the garment, locations, preparation scope, price, variable-cost definition, and target amount. A minimum calculated for one simple print should not silently apply to every job. The numbers here are constructed to explain the method, not to recommend a minimum for your business.
Check both sides of the quantity threshold
Copy these fields into the record for your next comparable job.
- Inputs
- Selling price, variable cost per finished shirt, fixed job cost, and target job profit amount.
- Boundary test
- Calculate profit at the rounded quantity and at one fewer shirt. Only the first should meet the target.
- Recalculate if
- A price tier, repeated setup, staffing step, or material cost changes before the calculated quantity is reached.
Put this into practice
Open the break-even calculator with your own job values.
AI-assisted educational content. Examples are illustrative; arithmetic is checked against the stated methods. This is not a field-tested production specification. Read our editorial policy.
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