Formula
Break-even ROAS is based on contribution margin before ads. Target ROAS subtracts the profit you want to protect before deciding the ad budget.
break-even ROAS = average order value ÷ contribution margin before ads
Ads calculator
Break-even ROAS calculator
Find the ROAS, maximum CPA, and target ROAS required to cover product cost, fulfillment, payment fees, returns, overhead, and target profit.
Inputs
Target ROAS
Target ROAS is usually higher than break-even ROAS because it reserves profit before spending on ads. If target ad budget is zero or negative, the current product economics cannot support the requested profit.
FAQ
Is break-even ROAS the same as platform ROAS?
No. Ad platforms report revenue divided by ad spend. Break-even ROAS is the minimum ratio you need after the business cost structure is included.