Break-Even & Target ROAS Calculator
Your break-even ROAS is the return you have to clear before Google Ads stop costing you money, and it is set by your margin, not an industry average. Enter your numbers below to get the exact break-even ROAS for your store, and the target ROAS to hit the profit you actually want.
Your numbers, worked out
The math, in one line
Break-even ROAS = 1 / gross margin. A 30% margin needs about a 3.3x return just to wash its face; a 50% margin only needs 2.0x. That is why the same 3x ROAS can be a strong month for a jewelry brand and a quiet loss for a low-margin seller. Your target ROAS is break-even plus the profit you want, which the calculator works out as 1 / (gross margin minus your target profit margin).
The number is only as honest as the tracking under it. If your conversion values are wrong, the ROAS is fiction in either direction, which is why we rebuild conversion tracking before we touch bidding.
Frequently asked questions
How do you calculate break-even ROAS?
Break-even ROAS is 1 divided by your gross margin. If your gross margin is 30%, your break-even ROAS is 1 / 0.30, which is about 3.3x. Below that you are buying revenue at a loss; above it you are buying profit.
What is a good target ROAS?
A good target ROAS is your break-even plus the profit you actually want the channel to deliver. The calculator works it out as 1 / (gross margin minus your target profit margin), so it always sits above break-even.
What counts as gross margin here?
Gross margin is what is left of an order after the cost of the goods and your variable costs (payment fees, shipping, transaction costs), before ad spend. The calculator derives it from your AOV, product cost and fee percentage.
Why is my real ROAS higher than my profit?
Almost always tracking. Ad platforms over-claim and brand traffic flatters the blend, so the reported ROAS reads higher than the money you actually keep. Reconcile your platform numbers against your backend orders before you trust the figure.
Want the full picture behind the number? Read what a good ROAS for ecommerce really is, then see how we move accounts onto value-based bidding to chase target ROAS instead of cheap clicks. Or get a free Due Diligence Audit and we will check whether the ROAS you see is the ROAS you are getting.