Break-Even ROAS Calculator
The minimum ROAS at which ads pay for themselves – from your price, product cost, shipping, fees and returns – plus the target ROAS for the profit you want.
What is break-even ROAS?
Return on ad spend (ROAS) is revenue ÷ ad spend. Break-even ROAS is the level at which the profit from an order exactly pays for the ads that brought it: above it a campaign makes money, below it every order loses money.
Break-even ROAS formula
break-even ROAS = price ÷ profit per order before ads
break-even ACoS = profit per order before ads ÷ price × 100
Example: an order of 80 costs 32 to make and 6 to ship, with 3% payment fees and 5% of revenue refunded. Profit before ads = 80 × 0.92 − 32 − 6 = 35.60. Break-even ROAS = 80 ÷ 35.60 = 2.25 (225%) – each 1 spent on ads must bring at least 2.25 in sales.
Target ROAS for a profit
To keep 10% of the price as profit after ads, leave 8 of the 35.60 aside: the ads may cost 27.60 per order, so the target ROAS is 80 ÷ 27.60 = 2.90 (290%). Use it as the target ROAS in Smart Bidding or as the line for pausing campaigns.
How to use the calculator
- Enter the average order value and the costs per order – product, shipping, fees and returns.
- Set the profit you want to keep after ads.
- The table shows the profit per order at other ROAS levels, with the break-even line highlighted.
ROAS and ACoS
Amazon sellers use ACoS – ad spend ÷ sales – which is simply 1 ÷ ROAS. A break-even ROAS of 2.25 is a break-even ACoS of 44.5%.
When ROAS below break-even is fine
Break-even ROAS looks at the first order only. If customers buy again, or the campaign wins new customers you keep for years, you can accept a lower ROAS on the first sale – work out the limit with the target CPA calculator.
Frequently asked questions
How do I calculate break-even ROAS?
Divide the price by the profit per order before ad costs. With a price of 80 and 35.60 left after product cost, shipping, fees and refunds, break-even ROAS is 2.25.
What ROAS do I need to make a profit?
Anything above break-even. For a set profit, divide the price by (profit before ads − the profit you want).
Is ROAS the same as ROI?
No. ROAS compares revenue with ad spend; ROI compares profit with all costs. A ROAS of 3 can still be a loss if margins are thin.