Fixed costs are expenses that stay the same no matter how much you sell. Rent, insurance, salaries, and software subscriptions are typical examples. If you sell nothing in a month, these bills still arrive. Fixed costs set the minimum revenue your business needs to survive each month.
You need this number for your break-even point and your monthly cash plan. A generated business plan lists fixed costs separately from variable costs for that reason.
An example. Your online shop pays €1,200 rent, €2,800 in salaries, €150 for software, €200 for insurance, and €650 for accounting. Total fixed costs are €5,000 per month. Each product sells for €40 and costs you €25 to buy and ship, so you keep €15 per sale. You need €5,000 divided by €15, which is 334 sales per month, before you earn anything. That single number says more about your risk than any forecast.
Two misunderstandings are common. First, fixed does not mean permanent. Rent rises, you hire a second employee, and the number jumps. Fixed means independent of sales volume, not unchangeable.
Second, many costs are only fixed inside a range. One delivery van covers up to 60 orders per day. Order 61 needs a second van, and your fixed costs step up by €900 a month.
Founders also forget their own salary. If you plan to draw €2,500 per month, put it into the fixed costs. A plan that only works because you work for free is not a plan.
Keep the list short and review it every quarter.
