Break-even ROAS calculator.

The break-even ROAS formula

Return on ad spend (ROAS) is the revenue your ads bring in divided by what you spent on them. You break even when the profit left on each order, before ads, pays for exactly the ad spend it took to win that order. That gives four figures:

• Margin before ads = price − cost of goods − shipping and fulfilment − fees. As a percentage, divide it by the price.
• Break-even ROAS = price ÷ margin before ads, which is the same as 1 ÷ margin before ads as a percentage.
• Break-even CPA (the most you can pay per sale) = margin before ads, in dollars.
• Target ROAS = 1 ÷ (margin before ads % − the profit you want to keep, as a % of the price).

A worked example: a product sells for $50, costs $20 to make and $5 to ship, and card fees take 3% ($1.50). That leaves $23.50, or 47% of the price, before ads. Break-even ROAS is $50 ÷ $23.50 = 2.13, so every $1 of ad spend has to bring in $2.13 of sales. The most you can pay for a sale is $23.50. To keep 10% of the price as profit, ads can take 37% of it, so the target ROAS is 1 ÷ 0.37 = 2.70 and the most you can pay for a sale is $18.50.

ROAS as a ratio and as a percentage

Ad platforms show the same number in two ways. A ROAS of 2.7 means $2.70 of sales for each $1 spent. Google Ads sets target ROAS as a percentage, where $5 of sales per $1 of spend is 500%, so a target of 2.70 is entered as 270%. The calculator shows both.

If you bid for a cost per sale instead, the break-even CPA and the CPA for your profit target are the figures to use. Google calls this target CPA: the average amount you want to pay for each conversion.

Which costs to include

• Cost of goods. What you pay for the product itself, or to make it, per order.
• Shipping and fulfilment. Postage, packaging and any warehouse or pick-and-pack charge you pay, less what the customer pays for delivery.
• Payment and platform fees. Card processing, and any marketplace or app commission that is a share of the sale.
• Returns and refunds. If 5% of orders come back, add 5% of the price to the fees, plus the cost of handling them.

Fixed costs such as rent, salaries and software are not per order, so they are left out of break-even ROAS. Cover them with the profit target instead: if those costs come to about 15% of your sales, set the target to at least 15%.

When a first order can break even

The calculator judges an ad on the first order alone. If customers often come back, an ad that only breaks even on the first sale can still make money over the following months. Work out what an average customer spends with you in their first year and what margin that leaves, and you can accept a lower ROAS on the first order. Check the repeat rate from your own sales before you do, not from an industry average.

Running ads to a ROAS target

A target ROAS only helps if the conversion values your ad account records are right, so check that tracking first. We set up and run Google Ads and Meta Ads campaigns around figures like these: your margin, the most you can pay for a sale, and the ROAS that leaves you a profit. If you want to talk through your numbers, contact us.

What press coverage does for a brand that runs ads

Most people who click an ad do not buy on the first visit. Many search the brand name first, and more of them now ask ChatGPT, Perplexity or Google’s AI Overviews whether the company is real and who runs it. If the only pages they find are your own site and your ads, they have nothing independent to go on.

• A page about you that you did not publish yourself. An editorial feature is a public, indexed article about your brand and its founder. Google and AI assistants look up pages like it when someone asks about you, so it is one of the pages they can find and quote. We promise the article, not where it ranks or whether an assistant mentions it.
• More trust before the click. Someone who has read about you is more likely to buy when they see your ad again. That can lift the conversion rate this calculator depends on, though no feature can promise a number.
• A profile for the founder. Partners, investors, hires and event organisers search the founder’s name too. A feature gives them a clear story to read, and a link to send.
• Material for your ads and social. “As featured in” with the publication’s name, quotes from the article, and a link in your bio give your ads and posts something to point to.

Our PR & Media Placements service writes the feature from a short brief, and you approve every word before it goes live. Features start at $249 for one publication, and on the titles marked Guaranteed · 24h on our PR page the approved feature is live within 24 hours of your approval (business days) or you get a full refund. Every feature is sponsored content and labelled as such, as our disclaimer states.