🎯 Break Even ROAS Calculator
Find your minimum profitable ROAS
Break Even ROAS = 1 ÷ Profit Margin
Use our free break even roas calculator to know the minimum return on ad spend needed to make a profit. Enter your product details and instantly see your break-even point.
How to Use This Calculator
Our beroas calculator offers two modes:
Detailed Mode (default) — for most users:
- Enter your selling price
- Add cost of goods, shipping costs, transaction fees
- Calculator shows your profit margin automatically
- See your break-even threshold instantly
Quick Mode — if you already know your margin:
- Switch to “Quick Mode”
- Enter your profit margin percentage
- Get your break-even result
Use our free tool to remove guesswork and know the minimum return needed before spending on advertising.
What is Break-Even Return on Ad Spend?
Break-even return on ad spend (BEROAS) is the minimum roas threshold where your online advertising neither gains nor loses money. Knowing your break-even roas helps you set realistic targets and optimize your advertising across all ad platforms.
A roas of 1 means you get back exactly what you spend — but after cost of goods (COG), shipping costs, and production costs, you’re likely losing money. That’s why you need to calculate the break-even threshold specific to your business.
ROAS Formula
The roas formula to find your break-even point:
Break Even ROAS = 1 ÷ Profit Margin
For example, with 25% margin: 1 ÷ 0.25 = 4.0x
This means you need $4 in total revenue for every dollar spent on advertising.
What is a Good ROAS?
A good roas depends on your margins. Here’s a benchmark comparison:
| Profit Margin | Break-Even | Target |
|---|---|---|
| 20% | 5.0x | 7x+ |
| 30% | 3.33x | 5x+ |
| 40% | 2.5x | 4x+ |
| 50% | 2.0x | 3x+ |
Set your target roas above break-even to maximize profits and allow room for business growth. Most ecommerce stores aim for 2-3x above their threshold.
Calculate Your ROAS for E-commerce
For e-commerce and ecom businesses, calculating your break even roas is essential. You need clear numbers on:
- Average order value and selling price
- COG and production costs
- Shipping costs per order
- Transaction fees (CPA for acquiring customers)
With these key metrics, you can set ad budgets that generate higher returns.
ROI vs ROAS — The Metric Difference
ROI measures total return on advertising including all business costs. The roas metric focuses only on ad revenue versus advertising spend.
ROI vs roas: use return on advertising spend for quick ad campaign evaluation. Use ROI for complete profitability analysis. Both are important in digital marketing, but break-even roas helps set minimum benchmarks.
Platform Benchmarks
Different marketing channels and ad platforms deliver different results:
| Platform | Typical Range |
|---|---|
| Google Ads | 2x – 8x |
| 2x – 5x | |
| TikTok | 1.5x – 4x |
| Snapchat | 1x – 3x |
Compare your results against these benchmark numbers. If you’re below break-even on any online advertising campaign, you’re losing money on that channel. Either optimize your advertising or reallocate total ad spend to better performers.
Customer Lifetime Value
For subscription businesses, understand the long-term value of each customer. Customer lifetime value (CLV) means you can accept lower initial returns while still achieving profitability over time.
If lifetime value is 3x the first purchase, your effective break-even is much lower. This helps ecom businesses focused on growth spend on advertising more aggressively.
How to Optimize Your Advertising
Once you calculate your roas threshold:
- Set target roas in Google Ads and other paid ads platforms
- Cut campaigns where you’re losing money
- Scale what delivers revenue to cover costs
- Adjust ad budgets based on performance
- Test different marketing channels
Every dollar spent should work toward profitability. Knowing your break-even roas eliminates guesswork and lets you make data-driven decisions.
FAQ
How do I calculate roas break-even?
Divide 1 by your profit margin. With 30% margin, break-even equals 3.33x.
What does roas of 1 mean?
It means ad revenue equals advertising spend — you’re breaking even on ads only, but likely losing money after COG and other costs.
Is 2x roas enough to make a profit?
Only with 50%+ margins. Lower margins need higher returns. Use our calculator to find your specific threshold.
How does CLV affect break-even?
Higher customer lifetime value means you can accept lower initial returns. Factor in repeat purchases for true profitability analysis.
What if CTR is low?
Low CTR increases CPA and reduces overall return on advertising. Improve ad creative to generate higher click rates.