Break-even ROAS Calculator

The margin math, step by step

Break-even ROAS is two steps: work out what one order actually leaves you after variable costs, then divide the order value by it.

With the defaults: an €80 order carries €28 of product cost, €9 of shipping and fulfillment, and 2.5% payment processing, which is €2. Variable costs total €39.

contribution margin = 80 - 39 = €41
break-even ROAS = 80 ÷ 41 = 1.95x

Every campaign returning less than 1.95x on these orders loses money at the contribution level. Every campaign above it adds money. Notice what never entered the calculation: rent, salaries, software. That is deliberate, and the FAQ below explains why.

Building profit into the target

Break-even is the floor, not the goal. If you want to keep 10% of AOV as profit on each paid order, that is €8 here. Subtract it from the margin before dividing:

target ROAS = 80 ÷ (41 - 8) = 2.42x

That 2.42x is the return where each order pays its variable costs and hands you €8. The gap between 1.95 and 2.42 looks small, but it is the entire difference between busy and profitable.

Setting platform targets from these numbers

Do not paste 1.95 into a tROAS field and call it done. Platforms miss conversions through tracking loss and consent gaps, and returns claw back revenue after the click. Both push your real return below what the dashboard reports. In practice I set platform targets 20 to 30% above the calculated line, then reconcile monthly against blended numbers. If your category has heavy returns, apparel for example, recompute the margin on net-of-returns revenue first.

When the calculator shows a red verdict

If the margin goes to zero or negative, ads cannot save the unit economics. The order loses money before a single click is bought. Fix price, product cost or shipping first. And if the margin is positive but your desired profit exceeds it, the target readout goes blank: no ROAS can produce that profit at this AOV, so raise prices or lower the goal.