Free tool · Online ads
Break-Even ROAS Calculator for Stores and Lead Generation
The short answer
Break-even ROAS is your revenue divided by the profit you make on it before advertising. A store with an $80 order that leaves $36 of profit after goods, fees and refunds breaks even at 80 ÷ 36 = 2.22×. A business that sells through leads breaks even at 1 ÷ its gross margin, and can pay at most its profit per customer times its close rate for each lead: $600 profit and a 20% close rate allow $120 a lead.
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What the calculator gives you
Return on ad spend (ROAS) is the revenue your ads bring in divided by what they cost. A ROAS of 3× means $3 of sales for every $1 of ads. The trouble is that ROAS counts revenue, not profit, so a number that looks healthy can still lose money. This calculator finds the lines that matter for your business:
- Break-even ROAS. Below it, every sale from ads loses money.
- The most you can pay per order, customer or lead. Your profit on the sale, before advertising.
- The most you can pay per click. That profit times the share of visits that convert.
- Target ROAS. The return that leaves you the share of profit you choose to keep.
It has two modes. Online store works per order, with the cost of goods, fees and refunds taken off. Leads, then a sale is for service businesses, B2B firms and high-ticket sales, where ads bring an enquiry and only some enquiries buy. Most break-even calculators that rank for this search are built for stores only and never ask for a close rate, so they cannot tell a service business what a lead is worth.
The formulas
| What | Online store | Leads, then a sale |
|---|---|---|
| Gross profit per sale | Order value × (1 − refund share) − cost of goods − fees | Sale value × gross margin |
| Break-even ROAS | Order value ÷ gross profit per order | Sale value ÷ gross profit per customer, or 1 ÷ margin |
| Most you can pay per sale | Gross profit per order | Gross profit per customer |
| Most you can pay per lead | Not used | Gross profit per customer × close rate |
| Most you can pay per click | Most per order × conversion rate | Most per lead × conversion rate |
| Target ROAS | Order value ÷ (profit × (1 − share kept)) | Sale value ÷ (profit × (1 − share kept)) |
Two worked examples
An online store. Orders average $80. Goods and packing cost $30 an order, shipping and card fees another $10, and refunds take 5% of revenue. The profit per order before ads is $80 × 0.95 − $30 − $10 = $36. Break-even ROAS is 80 ÷ 36 = 2.22×. To keep 30% of that profit, ads can spend $25.20 per order, a target ROAS of 3.17×. If 3% of visitors buy, the most a click can cost is $36 × 3% = $1.08.
A service business. A typical job is worth $1,200 at a 50% gross margin, so each customer leaves $600 before advertising. Break-even ROAS is 1 ÷ 0.5 = 2×. One enquiry in five becomes a customer, so the most a lead can cost is $600 × 20% = $120. Keeping 30% of the profit brings that down to $84 a lead. For a sense of scale, LocaliQ's 2026 Search Advertising Benchmarks put the all-industry average cost per lead on Google Search ads at $66.69, and its 2026 Facebook Ads Benchmarks put Meta lead campaigns at $27.39. Our ad budget calculator has the figures by industry.
Why a store and a service business need different maths
A store can measure ROAS straight from the ad platform, because the sale happens on the website and the revenue is recorded with it. A service business usually closes the sale later, by phone, WhatsApp or in person, so the platform sees the lead and never the revenue. Its ads should be judged on cost per lead against the most it can pay per lead, and later on cost per customer once sales are recorded against leads. Close rate does most of the work: halve it and the most you can pay per lead halves too. If leads come in but few buy, our guide to automating lead follow-up covers the fastest fix.
Using the result in Google Ads and Meta
Google Ads can bid to a return directly. Its Target ROAS strategy is set as a percentage: Google's example is 500%, meaning $5 of conversion value for every $1 spent, so multiply this calculator's target by 100. For Search and Shopping campaigns, Google lists at least 15 conversions in the past 30 days as a requirement. Below that, bid on cost per result instead, and check it against the most you can pay per sale or lead.
Two cautions:
- Platform ROAS is the platform's count. Each platform credits itself with the sales it can link to its ads, and two platforms can claim the same sale. Check total sales against total ad spend in your own records, not only each platform's dashboard.
- Repeat purchases change the answer. If customers buy again without more advertising, the first sale can run at break-even and still pay off. Enter a year of revenue per customer as the sale value only if you have the records to back it.
If your ads are below break-even now, see our guides to Google Ads clicks with no conversions and Facebook ads that get clicks but no sales.
Sources
All checked November 4, 2026.
- Google Ads Help, About Target ROAS bidding.
- LocaliQ and WordStream, 2026 Search Advertising Benchmarks, last updated June 1, 2026.
- LocaliQ and WordStream, 2026 Facebook Ads Benchmarks, last updated September 23, 2026.
Frequently asked questions
How do I calculate break-even ROAS?
Divide the revenue from a sale by the gross profit on it before advertising. An $80 order that leaves $36 after the cost of goods, shipping, payment fees and refunds breaks even at 80 ÷ 36 = 2.22×. If you know your margin as a percentage, break-even ROAS is 1 divided by that margin: a 50% margin breaks even at 2×.
What is a good ROAS?
Any ROAS above your break-even point makes money on the first sale, and how far above it you need to be depends on how much profit you want to keep. That is why this calculator asks for the share of profit to keep: keeping 30% of a $36 order profit means ads can spend $25.20 per order, a target ROAS of 3.17× on an $80 order. A single industry-wide 'good ROAS' ignores your margins.
How do I work out break-even ROAS for a service business?
Use the value of a sale and your gross margin on it, then your close rate. A $1,200 job at a 50% margin leaves $600, so ads can spend up to $600 to win that customer. If one lead in five becomes a customer, the most you can pay per lead is $600 × 20% = $120.
What is the difference between ROAS and ROI?
ROAS divides the revenue from ads by the ad spend and ignores every other cost. ROI compares profit with the total cost. A campaign can show a ROAS of 2× and still lose money if the margin is under 50%, which is why break-even ROAS is the line to measure ROAS against.
How do I set target ROAS in Google Ads?
Google Ads expresses target ROAS as a percentage: Google's own example is 500%, meaning $5 of conversion value for every $1 spent. Multiply the target from this calculator by 100. Google lists at least 15 conversions in the past 30 days as a requirement for target ROAS on Search and Shopping campaigns.
Should I include fixed costs like rent and salaries?
Not in break-even ROAS. It measures whether each sale covers its own costs and its advertising. Fixed costs are covered by the profit you keep, which is what the 'share of the profit you want to keep' setting is for.