Good Little ToolsTrue Break-Even ROAS
Find the ROAS and CPA where a DTC order actually breaks even after returns, fulfillment, payment fees, and product cost.
Order economics
Returns and targets
Acquisition limits
| Expected retained revenue/order | |
|---|---|
| Non-ad variable costs | |
| Contribution available for ads | |
| CPA at entered actual ROAS | |
| Profit per acquired order | |
| Modeled monthly profit |
This is contribution economics, not a forecast of incremental sales. Ad-platform attribution can overstate or understate causal revenue.
Why gross-margin ROAS is often wrong
The shortcut 1 ÷ gross margin ignores costs that happen after an order: payment processing, pick-and-pack, packaging, shipping subsidies, refunds, return labels, and damaged inventory. This calculator estimates expected retained revenue and subtracts those costs before deciding how much CPA the order can carry.
How returns are treated
The model reduces expected revenue by the return rate while retaining the original fulfillment costs and adding the return loss you specify. If your returned inventory is always resalable or your processor refunds fees, adjust the inputs to match your actual ledger.
ROAS and CPA questions
Why use gross AOV in the ROAS numerator?
Ad platforms commonly report attributed gross purchase value. Using the same numerator makes the threshold comparable to the platform’s ROAS display, while the denominator reflects expected contribution.
Is break-even ROAS a good target?
No. It is the point where modeled contribution after ads reaches zero. A sustainable target normally needs room for profit, uncertainty, overhead not allocated here, and attribution error.