Break Even ROAS Calculator

How the break even ROAS formula works

ROAS (return on ad spend) is revenue from ads divided by what you spent on them. Break-even ROAS is the point where the profit left after product and order costs exactly covers the ad spend. The calculator uses this formula:

Another way to write it is 1 ÷ contribution margin. With the example numbers above, a $60 product keeps $32.90 per order before ads, so break-even ROAS is 60 ÷ 32.90, about 1.82x. You can spend up to $32.90 to win each sale and still not lose money.

How to use the calculator

1. Enter the selling price. For a store with many products, use the average order value and average costs per order.
2. Add the product cost, shipping you pay, and your payment processor's percentage and fixed fee per order.
3. Add any other cost that grows with each order, such as packaging or refunds.
4. Set the profit margin you want to keep after ads to see a target ROAS for campaign settings and reports.

Break-even ROAS vs target ROAS

Break-even ROAS is the floor, not the goal. It ignores fixed costs like salaries, software and your agency fee, so a campaign sitting at break-even is still losing money for the business overall. Use the target ROAS as the number to report against, and the break-even figure as the line at which to pause or rework a campaign. ROAS in Meta Ads Manager or Google Ads also depends on the attribution setting, so compare it with revenue in the store before making a call.

Who it's for

Ecommerce brands, dropshippers and the agencies that run their Meta, Google and TikTok ads. Agencies can run it with a new client in the first call, so both sides agree on the ROAS that counts as working before any budget is spent.