Break-even ROAS
Calculator for Ecommerce Sellers
Estimate your break-even ROAS with refunds, payment fees, shipping, discounts, and fulfillment costs included.
Preview the report before entering your numbers.
SellMira turns your inputs into a break-even ROAS guardrail, CPA room, profit-after-ads estimate, margin leak diagnosis, PDF export, optional email report, and AI review context.
Break-even ROAS
Safety line for ads
Target ROAS
ROAS after target margin
Break-even CPA
Max affordable CPA
Profit after ads
Estimated order profit
The ROAS Profitability Problem
Many ecommerce operators start with the "platform ROAS" shown in Meta Ads Manager or Google Ads. However, platform ROAS does not know your cost of goods sold (COGS), fulfillment costs, payment fees, discounts, or refund rate.
If your ROAS is 3x, but your total variable costs consume 70% of your revenue, you are actually losing money once you account for ad spend. This calculator helps you find the Break-even ROAS - the exact point where you make zero profit, but also lose zero dollars.
What does ROAS mean?
ROAS stands for Return on Ad Spend. It is a marketing metric that measures the amount of revenue your business earns for each dollar it spends on advertising. For example, if you spend $100 on ads and generate $400 in sales, your ROAS is 4.0 or 400%.
How is ROAS calculated?
The generic ad-platform formula for ROAS is simple:
In Shopify marketing, you usually look at "Purchased Value" divided by "Amount Spent". For SellMira break-even math, the calculator uses net revenue after discounts, then subtracts product cost, shipping, fees, packaging, and refund impact before setting ROAS and CPA guardrails.
What is a good ROAS?
A "good" ROAS is entirely dependent on your margins. A luxury jewelry brand with 90% margins can be highly profitable at a 1.5x ROAS. A dropshipper with 20% margins might be losing money at a 4.0x ROAS.
Instead of using a generic benchmark, calculate the break-even ROAS from your own margin. A "good" ROAS is one that leaves enough contribution margin for your target profit and operating assumptions.
What should ROAS be for Shopify stores?
For Shopify stores running paid traffic, your target should be calculated based on your Contribution Margin.
- Break-even ROAS: The minimum ROAS needed to avoid losing money on the order.
- Target ROAS: The ROAS needed after your target profit, returns, and operating assumptions are included.
What this calculator counts
SellMira starts with selling price after discount, then accounts for product cost, shipping, packaging, transaction fees, fixed per-order fees, and expected refund impact. The result is a contribution-margin view before fixed overhead.
The break-even ROAS and break-even CPA outputs are guidance from your inputs, not a guarantee that an ad platform, store, or fulfillment operation will perform the same way in practice. Review your real fees, refund rate, and delivery costs before scaling.
Is 2.5 ROAS good?
2.5 ROAS can be good for one product and risky for another. Compare it with your break-even ROAS and target ROAS before treating it as safe.
Is 4x ROAS good?
4x ROAS may be healthy when your contribution margin is strong, but it is still not a guarantee. Check whether it clears your break-even ROAS and leaves enough room for your target margin.
What does 800% ROAS mean?
800% ROAS is the same as an 8.0x ROAS. It means for every $1 you spend on ads, you generate $8 in attributed revenue. Whether that is profitable still depends on product cost, fees, shipping, refunds, and discounts.
ROAS vs Break-even ROAS
ROAS is what you achieve.
Break-even ROAS is what you must achieve to avoid losing money.
If your Break-even ROAS is 2.5x and your current ROAS is 2.4x, the order may be losing money after variable costs and ad spend.
Frequently Asked Questions
Is ROAS calculated after tax/VAT?
Standard practice is to calculate ROAS on the net revenue (excluding tax) to get a true picture of business performance, as tax is a pass-through cost.
Does Shopify track ROAS automatically?
Shopify's marketing dashboard tracks ROAS if you have correctly integrated your pixels (Meta, Google, etc.). However, it often over-reports due to attribution window overlap.
What is the ROAS formula for marketing?
Generic ROAS is attributed revenue divided by ad spend. SellMira uses net revenue after discounts when calculating break-even ROAS, so the result reflects the money actually available before costs.
What costs should I include in break-even ROAS?
Use product cost, shipping, packaging, payment or transaction fees, discounts, and expected refund impact. The calculator uses these inputs to estimate contribution margin before ads.
Why can target ROAS be higher than break-even ROAS?
Break-even ROAS estimates the minimum ad efficiency needed to avoid losing money on the order. Target ROAS also leaves room for your chosen profit margin, so it is usually stricter.
What inputs do I need for the calculator?
Start with selling price, product cost, shipping, packaging, transaction fee, fixed fee per order, refund rate, discount rate, and either current ROAS or current CPA. If you do not know every value, use conservative estimates and update the report when real data is available.
Where do I find my transaction fee rate?
Check your payment provider, Shopify Payments settings, PayPal or Stripe dashboard, and any per-order platform fees. The fee field is a planning input, so use the effective percentage your store actually pays.
Does this work for Shopify Payments?
Yes. Enter your Shopify Payments percentage fee in the transaction fee field and the fixed per-order charge in the fixed fee field. Many US Shopify plans are often around 2.9% plus $0.30, but you should confirm your own plan and country before relying on that number.
How to Calculate Break-even ROAS
Break-even ROAS is a useful guardrail for ecommerce media buyers. It estimates the point where ad spend uses the contribution margin generated by the sale.
The formula for Break-even ROAS is:
To estimate contribution margin, subtract variable costs such as COGS, shipping, packaging, transaction fees, and refund impact from net revenue. If your net revenue is $100 and your contribution margin is $50, your break-even ROAS is 2.0x. If you achieve a 3.0x ROAS, that order may leave profit before fixed overhead. If you hit 1.5x, the order may lose money after ads.
Why Break-even CPA Matters
While ROAS is a common target in Meta and Google Ads, CPA (Cost Per Acquisition) is often a more stable metric for scaling. Your Break-even CPA is the maximum amount you can afford to pay to acquire a single customer without losing money.
Calculate it by:
Knowing this number can help you set bid caps and cost controls. If your Max CPA is $25, and your current CPA is $18, you have a $7 buffer per order before fixed overhead and other operating assumptions.
Example eCommerce Profit Calculation
| Line Item | Amount |
|---|---|
| Selling Price | $100.00 |
| Product Cost (COGS) | -$30.00 |
| Shipping & Handling | -$10.00 |
| Payment Fees (2.9% + $0.30) | -$3.20 |
| Profit Before Ads | $56.80 |
| Break-even ROAS | 1.76x |
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