What Is Your Nut? The Number Every Business Owner Needs to Know
If you run a small business, there's one number that matters more than your revenue, more than your profit margin, and more than your growth rate. It's called your nut — and if you don't know it, you're flying blind.
What Is "The Nut"?
Your nut is the total monthly cost of keeping your business alive. Rent, payroll, insurance, software subscriptions, loan payments, utilities — every fixed expense that hits your bank account whether you sell anything or not.
Think of it as your business's break-even number. If your revenue covers the nut, you survive. Everything above it is profit. Everything below it is a countdown to trouble.
Why Most Business Owners Get This Wrong
Here's the mistake: most owners know their big expenses but forget the dozens of smaller ones. That $49/month SaaS tool. The quarterly insurance premium averaged monthly. The annual license fee you only remember when it hits.
When you add them all up, the real number is almost always higher than you think. We've seen business owners underestimate their nut by 20–30%, which means they think they're profitable when they're actually bleeding cash.
How to Calculate Your Nut
- List every fixed monthly expense — rent, payroll, insurance, subscriptions, loan payments, utilities
- Convert irregular expenses to monthly — divide annual costs by 12, quarterly costs by 3
- Add a 10% buffer — because something always comes up
- That total is your nut
For example, if your fixed expenses are $8,500/month, your nut with buffer is roughly $9,350/month. That's $312/day your business needs to earn just to stay open.
What to Do With This Number
Once you know your nut, everything gets clearer:
- Pricing: You can work backward from your nut to set minimum prices
- Hiring: You know exactly how much additional revenue a new hire needs to generate
- Slow months: You know how much runway you have in your cash reserves
- Growth decisions: You can model how taking on new expenses changes your break-even
Calculate Yours in 2 Minutes
We built a free Break-Even Calculator that does the math for you. Plug in your numbers, and you'll see your daily nut, monthly nut, and how many units or billable hours you need to cover it.
Stop guessing. Know your nut.