Find the maximum cost per purchase your product can support, your break-even ROAS, and the ROAS needed to preserve a target profit margin.
Adds your chosen buffer above the target ROAS. This is a planning cushion, not a platform recommendation.
Break-even ROAS = Selling Price ÷ Max Break-even CPA.
Target ROAS = Selling Price ÷ Max CPA that still leaves your chosen target profit.
Check profit at your current CPA →The calculator above starts with selling price and removes product cost, shipping or fulfillment, other variable costs, percentage payment or platform fees, fixed order fees and a refund reserve. What remains is contribution before advertising. That contribution is the maximum CPA the modeled order can absorb before profit reaches approximately zero. You can then add a target net margin and optional ROAS safety buffer to create a stricter advertising threshold.
The sticky summary separates break-even ROAS from target ROAS because they answer different questions. Break-even tells you where profit disappears. Target ROAS tells you what revenue-to-ad-spend ratio is needed to preserve the profit margin you selected. The buffered target gives an additional cushion above that minimum.
If non-ad costs already equal or exceed selling price, there is no positive acquisition budget. Similarly, a target margin can be mathematically valid before ads but impossible after ads if the desired profit consumes all remaining contribution. These conditions are why the calculator displays “not viable” instead of forcing a misleading ROAS number.
Assume a $50 selling price, $18 product cost, $6 fulfillment, $1.50 other variable cost, a 3% payment or platform fee, a $0.30 fixed fee and a 5% refund reserve. Percentage costs equal $4.00, so total non-ad costs are $29.80. Contribution before advertising is $20.20. Maximum break-even CPA is therefore $20.20 and break-even ROAS is about 2.48×. A 20% target margin requires $10 of profit, reducing target CPA to $10.20 and raising target ROAS to about 4.90×.
| Cost layer | Example | Effect on ad limit |
|---|---|---|
| COGS | $18.00 | Directly reduces maximum CPA |
| Fulfillment | $6.00 | Directly reduces maximum CPA |
| Percent fees + refund reserve | $4.00 | Scale with selling price in this model |
| Target profit | $10.00 | Creates a stricter target CPA than break-even |
A campaign at 3.0× ROAS would be above the 2.48× break-even threshold but below the 4.90× target needed for a 20% modeled margin. That does not automatically make the campaign bad; it means the entered profit target would not be preserved under those assumptions.
Break-even ROAS is the revenue-to-ad-spend ratio at which the modeled order reaches approximately zero profit after the non-ad costs entered.
Maximum break-even CPA equals selling price minus modeled non-ad variable costs such as product cost, fulfillment, payment or platform fees, fixed order fees and refund reserve.
Target ROAS preserves a chosen profit margin, so the allowed advertising cost is lower than the break-even CPA. Lower allowed ad cost means a higher required ROAS.
Usually not. Break-even is a boundary, not a safety margin. A practical operating target often needs room for attribution noise, refunds, overhead and changing auction costs.
Formula definitions are documented in our methodology. For budget planning after you know your CPA limits, use the Ad Budget Calculator.