Free ecommerce tool
Know the ROAS floor before increasing budget on Google, Meta, TikTok, or affiliate campaigns.
Quick answer
Break-even ROAS is the point where order contribution before ads is exactly consumed by ad spend. If contribution before ads is 40% of revenue, the break-even ROAS is 2.50x before overhead and profit.
Enter your details to generate a decision-ready output.
Break-even ROAS is revenue divided by contribution before ad spend. Contribution before ad spend is the money left after product cost, fulfillment, shipping, payment fees, and other order-level variable costs.
If an order is $100, product cost is $40, shipping is $10, and fees are $5, contribution before ads is $45. Break-even ROAS is $100 / $45 = 2.22x. Spend more than $45 to acquire that order and the order is negative before overhead.
Ad platforms report revenue divided by ad spend. They usually do not know your landed product cost, returns, payment fees, warehouse cost, creative cost, or overhead. A 3x ROAS can be excellent for a high-margin digital product and poor for a low-margin physical product.
| Input | Why it changes ROAS floor |
|---|---|
| Product cost | Higher cost lowers contribution and raises the ROAS needed to break even. |
| Shipping and fulfillment | Free shipping offers can turn a profitable order into a break-even order. |
| Payment and platform fees | Small fees matter when margin is already tight. |
| Returns | Not in the simple calculator, but should be added to the decision before scaling. |
| Mistake | Why it hurts |
|---|---|
| Using revenue margin instead of contribution | It ignores shipping, fulfillment, and payment fees. |
| Using the same target for all products | It hides weak-margin products inside a blended average. |
| Ignoring discounts | A sale can raise conversion while pushing the ROAS floor higher. |
| Forgetting return allowance | Returned orders can make an apparently profitable target too low. |
Enter one product group or one representative blended order at a time. The calculator subtracts product cost, shipping, fulfillment, and fees from revenue, then converts the remaining contribution into a ROAS floor.
The result excludes returns, fixed overhead, creative production, agency fees, inventory financing, and payback timing. Add those before using the result as a scaling target.
No. It is the floor. A real target usually needs room for overhead, returns, cash timing, and profit.
Products with different cost, shipping weight, return rate, or discount behavior have different contribution margins, so their ROAS floors differ.
Only for a blended planning pass. For budget decisions, calculate separate floors for major product groups and offer types.