ROAS calculator with break-even ROAS and CPA

The three numbers, and how each one is worked out

Break-even ROAS is the return on ad spend where an order pays for its own ads and nothing more. Below it, every sale the ads bring in loses money. The calculator gets there in three steps, and shows each one next to its result:

• What an order keeps before ads = price − returns − fees − product cost − shipping. Returns are the price times your returns rate, and fees are the price times your fee rate.
• Break-even CPA = what an order keeps before ads. That is the most you can pay in ads to win one order and still end at $0.
• Break-even ROAS = price ÷ what an order keeps before ads.
• Target ROAS for a profit margin = price ÷ (what an order keeps − margin × price). The margin is a share of the price, so a 10% margin on a $60 order means $6 of profit after ads.

The check at the bottom runs the other way. ROAS = revenue ÷ ad spend. Profit after ad spend = revenue × your contribution margin − ad spend, where the contribution margin is what an order keeps divided by its price. CPA = ad spend ÷ orders.

A worked example

A $60 order with an $18 product cost, $7 of shipping, 3% payment fees and a 5% returns rate:

• Returns cost $60 × 5% = $3.00, and fees cost $60 × 3% = $1.80.
• The order keeps $60 − $3.00 − $1.80 − $18 − $7 = $30.20. That is the break-even CPA.
• Break-even ROAS is $60 ÷ $30.20 = 1.99. You need about $1.99 of revenue for every $1 of ads just to stand still.
• For a 10% margin, set aside $6 of profit per order. That leaves $24.20 for ads, so the target ROAS is $60 ÷ $24.20 = 2.48, with a target CPA of $24.20.

Now say a campaign spent $2,000 and brought in $5,400 from 90 orders. ROAS is $5,400 ÷ $2,000 = 2.70, above the 1.99 break-even. The contribution margin is $30.20 ÷ $60 = 50.3%, so those sales kept $5,400 × 50.3% = $2,718, and profit after ad spend is $2,718 − $2,000 = $718. CPA was $2,000 ÷ 90 = $22.22, under the $30.20 break-even. Press Fill in the worked example above to see the same numbers.

When a product cannot break even

If the costs of an order add up to more than its price, the order loses money before any ad is shown. No ROAS fixes that, however high, because ads only add cost. The calculator says so instead of printing a negative ROAS. The same goes for a target margin bigger than what the order keeps: a product that keeps 30% of its price can never make a 35% margin, even with free traffic. The fix is in the price or the costs, not in the ads.

ROAS as a multiple and as a percentage

The same number is written two ways. Google Ads writes it as a percentage: in its Target ROAS help page, $5 of sales for each $1 of ad spend is a target ROAS of 500%. Meta’s ROAS goal uses a multiple: its example of $110 in purchases from a $100 budget is a 110% return, entered as a goal of 1.100. The calculator shows both, so a break-even of 1.99 is 199% in Google Ads.

Meta defines purchase ROAS as purchase conversion value divided by amount spent, and notes that statistical modelling may be used when some events cannot be counted directly. That is why the revenue you enter in the check should be the revenue you trust, which is not always the number in the ad account.

Returns, and why break-even uses the full price

Ad platforms report the value of a purchase when it happens. A refund three weeks later does not come off the ROAS in the ad account. So the calculator compares the platform-style ROAS (full price over ad spend) against a break-even that already allows for returns. It treats a returned order as refunded in full with its product, shipping and fee costs still spent, which is the cautious case. If you resell most returns, your real break-even sits a little lower than the one shown.

What this tool does not do

• It does not include fixed costs like salaries, software or rent. Break-even here means each order pays for its own ads, not that the business is profitable.
• It does not count repeat purchases. If customers come back, a first order can be worth running at a loss, and the break-even on lifetime value is lower. That is a judgement about your customers the calculator cannot make.
• It treats every order as one average order. If you sell products with very different margins, work each out on its own.
• It does not know which sales the ads really caused. ROAS in an ad account is the platform’s attributed value, not proof of cause.

If you would rather not do this sum every Monday

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Frequently asked questions

How do you calculate break-even ROAS?

Work out what one order keeps before ads: price minus product cost, shipping, fees and the cost of returns. Break-even ROAS is the price divided by that amount. A $60 order that keeps $30.20 has a break-even ROAS of 60 / 30.20 = 1.99.

What is the difference between break-even ROAS and break-even CPA?

They are the same limit seen two ways. Break-even CPA is the most you can pay in ads for one order, which equals what the order keeps before ads. Break-even ROAS is the price divided by that CPA, so it tells you how much revenue each $1 of ads has to bring back.

What ROAS do I need to make a profit?

Decide the margin you want as a share of the price, take that profit off what an order keeps, and divide the price by what is left. For a $60 order that keeps $30.20, a 10% margin leaves $24.20 for ads, so the target ROAS is 60 / 24.20 = 2.48.

Is ROAS a percentage or a multiple?

Both are used. Google Ads writes it as a percentage: $5 of sales per $1 of ad spend is 500%. Meta's ROAS goal uses a multiple, so a 110% return is entered as 1.100. The calculator shows both.

Why does the calculator say my product cannot break even?

Because the costs of an order add up to more than its price before any ad spend. Ads only add cost, so no ROAS can make that order profitable. Raising the price or cutting product, shipping or return costs is the only fix.

Is anything I type sent anywhere?

No. The sums run in your browser. There is no network request carrying what you type and nothing is stored, so reloading the page clears it.