Break-even ROAS calculator for Meta Ads
Enter your order value and the share you keep after product costs. See the ROAS where the campaign breaks even, then a target a safe distance above it.
Break-even ROAS is the return on ad spend at which a campaign earns back exactly what it cost, once product costs are taken out. It is one divided by your margin, so a business that keeps a quarter of each sale needs a ROAS of 4 just to break even. This calculator does the sum for your numbers, shows the most you can pay per sale, and sets a target with a safety buffer. If you sell leads instead of products, use the cost per lead version.
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Cofoundr compares each account's cost per result with its target and flags the ad sets paying more than they should.
How it works
- Online sales: break-even cost per sale = average order value x gross margin. Break-even ROAS = 1 / gross margin.
- Leads: break-even cost per lead = margin per customer x share of leads that become customers.
- Suggested targets apply your safety buffer: target cost = break-even x (1 - buffer), target ROAS = break-even ROAS x (1 + buffer).
How to use the result
These are the first-purchase economics only. If customers buy again, lifetime value can justify a higher cost, but agree that with the client in writing. Record the target and the date it was agreed.
Common questions
What is break-even ROAS?
The return on ad spend at which revenue after product costs exactly covers ad spend. Below it the campaign loses money, above it the campaign makes a margin.
Which margin should I use?
Use what you keep from a sale after the product or service cost and any costs that rise with each sale. Agree the figure with the client, because a different margin gives a different break-even.
Which margin should I use?
Gross margin on the product, before ad spend. Ask the client for it, and be clear whether shipping and payment fees are included.
What if a customer buys more than once?
Then lifetime value is higher than the first order. Use it only if the client agrees and the data supports it.
Is a buffer really needed?
Yes. Your inputs are estimates, and a target exactly at break-even leaves no room for profit or error.
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