Break-even ROAS calculator

Contribution margin per order is what one order leaves after the costs that come with it. Take the order value. Subtract the cost of the products, shipping and fulfilment, payment fees, the share you refund, and anything else each order costs. What is left pays for ads, then for everything else, then profit.

Break-even ROAS is order value divided by contribution margin. It tells you how many dollars of sales each ad dollar has to bring in so the order pays for its ad and nothing more.

Break-even CPA is the contribution margin itself, in dollars. It is the most you can spend on ads to win one order without losing money on it.

Target ROAS leaves room for profit. Choose the share of each order you want to keep after ads. Take that amount off the contribution margin, and divide the order value by what is left.

Example, the calculator’s starting numbers, which are ours for illustration: a $80.00 order with goods at 35% ($28.00), $9.00 of shipping and fulfilment, 5% returns ($4.00) and $2.00 of other costs. That leaves $37.00, or 46.3% of the order. Break-even ROAS is 80 ÷ 37 = 2.16, and break-even CPA is $37.00. To keep 10% ($8.00) after ads, you can spend $29.00 per order, a target ROAS of 2.76.

The example leaves payment fees out because they depend on your provider and plan. Add yours and every number moves: the margin gets smaller and the ROAS you need gets higher.

• Average order value: sales divided by orders over the last 90 days, from your store’s reports. Use the same definition your ad platform uses, so the ROAS figures match.
• Cost of goods: what you paid for the products, including inbound freight and duties if you can split them out.
• Shipping and fulfilment: postage, boxes and packing time per order. If customers pay for shipping, take that off.
• Payment fees: check your plan’s rate with your payment provider. If your Shopify store uses a third-party payment provider instead of Shopify Payments, Shopify adds its own fee on top: 2% on Basic, 1% on Grow, 0.6% on Advanced, 0.2% on Plus, per its pricing page on 10 November 2026. Add that to the percentage field.
• Returns: refunds as a share of sales. We count a refund as money lost. If you resell most returned items, use a lower figure.

Leave out costs that don’t change with each order, such as rent, salaries and monthly software. Those come out of the profit you keep, which is why the target ROAS matters more than the break-even one.

1. Ads running below break-even? Each order they win costs you money. Cut the worst campaigns first, or raise the order value with bundles or a free-shipping threshold.
2. Break-even ROAS higher than your ads reach? Your margin per order is too thin for paid ads as they run now. Look at product cost, shipping and order value before spending more.
3. Want to rely less on ads? Search and email don’t charge per click. Our guide to what ecommerce SEO costs sets out retainers, software and a do-it-yourself route, with the math for what a retainer has to bring in.
4. Want help with the store itself? Every price we charge an online store is on our ecommerce pricing page.

This is a quick check on one average order, not accounting advice. Products with very different margins are worth running one at a time.