What is the Break-even ROAS Calculator?
Break-even ROAS is the return on ad spend at which advertising neither makes nor loses money on the first order. Formula: break-even ROAS = AOV ÷ (AOV − variable costs) = 1 ÷ contribution margin, where variable costs are product, shipping, payment and platform fees and any other per-order costs. A 40% contribution margin needs at least 2.5× ROAS; a 25% margin needs 4×.
With a $60 order, $18 product cost, $7 shipping, 3.5% fees and $1 of other costs, contribution is $31.90 (53.2%), so break-even ROAS is 1.88× and you can spend up to $31.90 in ads to win each order.
How to use the Break-even ROAS Calculator
- Enter Average order value.
- Enter Product cost per order and Shipping & fulfilment per order.
- Set Payment & platform fees as a percentage and add Other variable costs per order, such as packaging.
- Read break-even ROAS (also shown as a percentage), contribution margin, break-even CPA and the maximum ad spend per $100 of revenue.
Why use AnyShift's Break-even ROAS Calculator
Popular use cases
- Setting the minimum ROAS for Meta, Google or TikTok campaigns
- Deciding whether a campaign is profitable or just busy
- Comparing products with different margins before advertising them
- Explaining to a client why a 2× ROAS can still lose money
Break-even ROAS by contribution margin
| Contribution margin | Break-even ROAS | Max ad spend per $100 revenue |
|---|---|---|
| 20% | 5.00× | $20 |
| 25% | 4.00× | $25 |
| 30% | 3.33× | $30 |
| 40% | 2.50× | $40 |
| 50% | 2.00× | $50 |
| 60% | 1.67× | $60 |
| 70% | 1.43× | $70 |
To check a live campaign, compare its reported ROAS with this figure, or use the ROAS calculator to work it out from spend and revenue.
Frequently asked questions
Is break-even ROAS the same as target ROAS?
Why is my ROAS positive but I still lose money?
What is a good ROAS for ecommerce?
Should break-even ROAS include overheads?
How do I convert ROAS to a percentage?
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Last reviewed: Built for: United States, United Kingdom, Canada, Australia Part of Ecommerce & Sellers