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Break-Even ROAS Calculator

Updated .

Your break-even ROAS is the return on ad spend below which every sale loses money — it's the inverse of your contribution margin. Enter your order economics to find your break-even, the target ROAS for a chosen profit per order, and your maximum cost per acquisition.

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    Send me my ROAS targets

    We'll email your break-even and target figures so you can set them as guardrails in your ad account.

    How this is calculated

    Break-even ROAS is the inverse of your contribution margin rate. If you keep 40 cents of every dollar after product, fulfilment and fees, then every dollar of ad spend has to return $2.50 in revenue just to get your money back — 1 ÷ 0.40.

    Target ROAS works the same way but reserves your desired profit before doing the division, so it is always higher than break-even. Both figures are per-order and ignore fixed overhead, which means clearing break-even keeps the lights on but does not by itself make the business profitable.

    One caution on the current ROAS you enter: platform-reported ROAS uses the ad platform's own attribution, which typically counts revenue it did not solely cause. Blended ROAS — total store revenue divided by total ad spend — is the more honest input.

    Contribution = AOV − product & fulfilment − (AOV × variable fee %) Break-even ROAS = AOV ÷ contribution Target ROAS = AOV ÷ (contribution − desired profit) Max CPA = contribution Ad cost/order = AOV ÷ current ROAS

    Questions merchants ask

    Is a 3x ROAS good?

    It depends entirely on your margin, which is why the question has no general answer. A store with a 70% contribution margin breaks even at roughly 1.43x, so 3x is very profitable. A store with a 25% margin breaks even at 4x, so 3x loses money.

    Should I use blended or platform-reported ROAS?

    Blended, for decisions about whether the business is profitable. Platform-reported figures double-count across channels and include organic sales that would have happened anyway. Use platform numbers only to compare campaigns against each other within the same account.

    Why is my break-even ROAS getting worse over time?

    Rising product or freight costs, a shift in product mix toward lower-margin items, discounting, or growing app and transaction fees. Re-run the numbers quarterly rather than setting a target once and leaving it.

    Does this account for repeat customers?

    No — it is deliberately first-order economics. If your customers reliably buy again, you can justify a lower ROAS on acquisition, but only if you have measured repeat rates rather than assumed them. Use a lifetime value calculation to set that allowance.

    Estimates only. Enter your own processing rates and costs — nothing here is pulled from a platform price list, so it stays accurate as fees change.