Break-Even ROAS Calculator
Break-even ROAS is the minimum return on ad spend you need before an order stops being profitable. Enter your gross margin below to find yours instantly.
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How break-even ROAS is calculated
Break-even ROAS is simply 1 ÷ gross margin. If a product has a 40% gross margin, every £1 of ad spend needs to generate at least £2.50 in revenue (a 2.5x, or 250%, ROAS) just to cover the cost of goods sold on that sale — before the ad spend itself is even accounted for.
This is the floor, not the target: it tells you the point below which a sale is actively losing money on COGS alone. Most stores aim well above break-even to also cover overhead, shipping, and leave room for actual profit — see the Target ROAS calculator for that next step.
FAQ
What's the difference between break-even ROAS and target ROAS?
Break-even ROAS is the floor — the point where a sale stops losing money on cost of goods. Target ROAS builds in your desired profit margin on top of that floor.
Does this account for shipping, payment fees, or overhead?
No — this calculator uses gross margin only (price minus cost of goods sold). For a fuller picture that includes fees and shipping, use the Shopify Profit Margin calculator.
Why is my break-even ROAS so high?
Low-margin products need a much higher ROAS to break even. A 20% margin product needs a 5x ROAS just to cover COGS — that's normal, and it's exactly why per-product profitability matters more than a single account-wide ROAS target.
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