Break-Even ROAS Calculator
Stop losing money on ads. Find out the exact Return on Ad Spend (ROAS) you need to hit just to break even on your product sales.
Product Economics
Your Target Metrics
You must maintain at least a 2.15x ROAS on your ads to avoid losing money.
You can spend up to $23.25 on ads to acquire a single customer before taking a loss.
What is Break-Even ROAS?
Break-Even Return on Ad Spend (ROAS) is the most critical metric for any e-commerce or dropshipping business running paid ads. It represents the exact ROAS multiplier you need to hit on your Facebook, TikTok, or Google Ads to exactly cover your product costs, shipping, and the cost of the ad itself.
If your actual ROAS is higher than your Break-Even ROAS, you are making a profit. If it is lower, you are losing money on every sale.
The Formula
To calculate Break-Even ROAS, you first need to know your Gross Profit Margin.
Gross Profit Margin = ((Sale Price - Cost of Goods Sold) / Sale Price) * 100
Break-Even ROAS = 1 / (Gross Profit Margin %)
Why You Must Know Your Break-Even ROAS
Many beginner dropshippers see a 2.0 ROAS in their Facebook Ads Manager and assume they are profitable. However, if their product has low margins (e.g., a 30% gross margin), their Break-Even ROAS is actually 3.33. This means a 2.0 ROAS is heavily unprofitable, and they are burning cash to acquire customers.
Frequently Asked Questions
What is the Break-Even ROAS Calculator?
The Break-Even ROAS Calculator is a free online tool designed to help you find out the exact return on ad spend you need to hit just to break even on your product sales.
How much does the Break-Even ROAS Calculator cost?
Our Break-Even ROAS Calculator is 100% free to use. We do not require any signups, subscriptions, or credit cards.
Is my data safe when using this tool?
Yes. All calculations are performed locally in your web browser. We do not store or save your financial data or inputs on our servers.