Free tool for ecom operators

Break even ROAS calculator

Enter what one order earns and costs. See the exact ROAS where your ads stop losing money, and the ROAS you need to hit your profit goal.

One average order
$
$
$
%
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Your ads
%
x
$

Example numbers are loaded. Replace them with yours and the result updates as you type.

Your break even ROAS 1.92x

0x4x
Losing money below Under goal below You are at
Margin before ads
Most you can pay per order
ROAS needed for your goal
Monthly profit at current ROAS

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What does break even ROAS mean?

ROAS is revenue divided by ad spend. Break even ROAS is the point where the money left after product, shipping and fees exactly covers what you paid for the ad. Below it, every sale from ads costs you money. Above it, every sale adds profit.

Break even ROAS = 1 ÷ margin before ads

A store keeping 50% of each order before ads breaks even at 2.0x. A store keeping 25% needs 4.0x. This is why two brands with the same ROAS can have opposite results.

Read more: break even ROAS with a worked example, and the ROAS to target at your margin.

How should you use the result?

Treat break even ROAS as the floor and goal ROAS as the target for every campaign.

  • Set your break even ROAS as the floor for cost caps and ROAS targets in Meta and Google.
  • Judge each campaign against your goal ROAS, not against an industry average.
  • Use the most you can pay per order as your CPA ceiling when testing new creatives.
  • Recalculate whenever product cost, shipping rates or prices change.

How can you lower your break even point?

Keep more of each order, or make each order bigger.

  • Raise average order value with bundles and post purchase offers. Costs like shipping do not rise at the same rate.
  • Negotiate product cost once volume grows. A 10% cut on cost of goods often beats a 10% lift in ROAS.
  • Set a free shipping threshold above your current average order value.
  • Count repeat purchases. If customers buy again within 90 days, you can afford a lower first order ROAS.

What do people ask about break even ROAS?

What is a good ROAS for ecommerce?

Any ROAS above your goal figure in this calculator. A 2.5x can be strong for a 60% margin brand and a loss for a 30% margin brand.

Should I include tax and discounts?

Leave sales tax out. Use your average order value after discount codes, since that is the money you actually collect.

Does this account for returning customers?

No. It measures first order profit only, which is the safest number to plan ad spend around.