Free Tool · Ecommerce

ROAS Calculator and Break-Even ROAS Calculator

Enter your order value, product cost, shipping, and ad results to see your ROAS, your break-even ROAS, the most you can pay per order, and the Target ROAS to set in Google Ads for the profit margin you want.

What is a good ROAS? A good ROAS is any ROAS above your break-even ROAS, and your break-even ROAS depends on your margin. A store that keeps 60% of every sale after product and shipping costs breaks even at about 1.67x. A store that keeps 25% needs 4x just to break even. That is why a single "good ROAS" number does not exist. Use the calculator below to find yours, then see how it compares to what your Google Ads for ecommerce campaigns are doing today.

01How This Calculator Works

The calculator starts with your cost to fill one order. It subtracts that cost from your average order value to get your profit per order before ads. That profit, as a share of your order value, is your contribution margin, and every other number comes from it.

Cost per order. Product cost plus shipping and fulfillment, payment processing, and any other per-order costs like packaging or returns. Product cost can be entered in dollars or as a percent of the order.
Payment processing. The default is 2.9% plus $0.30 per order. Change it to match your payment provider and plan.
Your ad results. Enter your monthly ad spend and either the orders or the revenue your ads drove. The calculator works out the other one from your average order value.
Target profit margin. Optional. Enter the margin you want left after ad spend, and the calculator gives you the Target ROAS that gets you there.

Nothing you enter is saved or sent anywhere. The math runs in your browser. Open "How this is calculated" in the tool to see every formula.

Question to Answer Do you know your real cost to fill one order, including shipping, payment fees, and packaging?

02What ROAS Means

ROAS stands for return on ad spend. It is your revenue from ads divided by what you spent on those ads. If you spend $1,000 and your ads drive $4,000 in sales, your ROAS is 4x, or 400%.

ROAS measures revenue, not profit. A 4x ROAS on a product with a 20% margin loses money, while a 2x ROAS on a product with a 70% margin makes money. For a full breakdown of the metric, read what is ROAS.

Question to Answer What was your ROAS last month, and was it calculated from revenue your ads actually drove?

03Break-Even ROAS Explained

Break-even ROAS is the ROAS where your ads pay for themselves and nothing more. Below it, every sale from ads loses money. Above it, every sale makes money. The formula is simple: 1 divided by your contribution margin.

Here is the worked example the calculator loads with:

Average order value: $85.
Cost per order: $29.75 product cost (35%), $8.00 shipping, and $2.765 payment processing (2.9% of $85 plus $0.30). That is $40.515 total.
Profit per order before ads: $85.00 minus $40.515 leaves $44.485, which rounds to $44.49. That is also your break-even CPA, the most you can pay in ads for one order.
Contribution margin: $44.49 divided by $85 is 52.3%.
Break-even ROAS: 1 divided by 0.523 is 1.91x, or 191%.

With $3,000 in ad spend and 120 orders, this store brings in $10,200 from ads, a 3.40x ROAS. That is well above its 1.91x break-even, and it leaves about $2,338 in profit after product costs, fees, and ad spend. If the same store wants a 10% profit margin after ads, its target ROAS is 1 divided by (0.523 minus 0.10), which is 2.36x.

Keep in mind, this profit does not include fixed costs like rent, salaries, software, or management fees. Those come out of what is left.

Question to Answer What is your break-even ROAS, and is your current ROAS above or below it?

04How to Set Target ROAS in Google Ads

Google Ads defines Target ROAS as the average conversion value you want for each dollar you spend on ads. You enter it as a percent. Google's own example is $5 in sales for every $1 in ad spend, which is a 500% target ROAS. So a 2.36x target is about 236% in Google Ads. The calculator rounds its suggestion up to the next whole percent, 237%, so you do not land below the margin you want.

Track conversion value first. Target ROAS bids on the conversion values you send to Google. If those values are wrong, your target is wrong. Check whether your purchase value includes tax and shipping, because your ROAS math should use the same revenue Google sees.
Have enough conversions. For Search and Shopping campaigns, Google requires at least 15 conversions in the past 30 days to use Target ROAS.
Start from your history. Google says your target should be based on your business goals and your historical ROAS. If your account runs at 3x today, jumping straight to 6x can cut your traffic hard.
Know the tradeoff. Google notes that a target that is too high can limit how much traffic your ads get. Lowering the target can bring more conversion volume, and raising it can push for more conversion value per dollar.
Never set it below break-even. A Target ROAS under your break-even ROAS tells Google it is fine to lose money on every sale.

For most online stores, Target ROAS matters most in Shopping and Performance Max campaigns. If you are building those out, read our guides to Google Shopping ads, how to structure Shopping campaigns, and Performance Max.

Question to Answer Is your Target ROAS in Google Ads set above your break-even ROAS, and does it match the margin you want?

05ROAS vs POAS and Profit

POAS stands for profit on ad spend. Instead of dividing revenue by ad spend, you divide the gross profit from those sales by ad spend. A POAS of 1 means you broke even on ads. Anything above 1 is profit.

The two tell you the same story in different units. Break-even ROAS and a POAS of 1 are the same point. The difference shows up when your products have very different margins. A 4x ROAS on a low-margin best seller and a 4x ROAS on a high-margin accessory look the same in Google Ads, but one can lose money while the other makes plenty.

If your margins vary a lot by product, group products with similar margins into their own campaigns or asset groups and give each its own target. This calculator helps you find the right target for each group. To find which products are dragging your results down, read how to spot underperforming products in Shopping ads.

Question to Answer Do your best-selling products have similar margins, or do some need a higher ROAS target than others?

Want to see how we run ecommerce accounts? Visit our ecommerce Google Ads management page.

ROAS Calculator FAQ

What is a good ROAS? A good ROAS is one above your break-even ROAS. Your break-even ROAS is 1 divided by your contribution margin, so a store with a 50% margin breaks even at 2x and a store with a 25% margin breaks even at 4x.

How do you calculate break-even ROAS? Subtract your cost per order (product, shipping, payment fees, and other costs) from your average order value, then divide by your average order value to get your contribution margin. Break-even ROAS is 1 divided by that margin.

How do I enter Target ROAS in Google Ads? Google Ads uses a percent. Multiply your target ROAS ratio by 100, so a 4x target is 400%. Google requires at least 15 conversions in the past 30 days for Search and Shopping campaigns to use Target ROAS.

What is break-even CPA? Break-even CPA is the most you can pay in ad spend for one order without losing money. It equals your average order value minus your cost per order.

Is ROAS the same as profit? No. ROAS measures revenue per dollar of ad spend. Profit depends on your margin. A 4x ROAS loses money if your margin is under 25%, so always compare your ROAS to your break-even ROAS.