The break-even point is an essential concept in business management.
It represents the level of activity that a company must reach in order to stop losing money.
If activity falls below this level, the company incurs losses; above it, the company generates a profit.

Its calculation is based on the behavior of costs.
It allows managers to estimate in advance how easily the company can achieve a profit, depending on production capacity, sales forecasts, and other factors.
It therefore serves as a tool to assess business risk.