/General Questions
Question
Can someone explain break-even ROAS and when to kill an ad in simple terms?
Posted by •11/20/2025
I keep hearing "know your break-even ROAS" and "kill ad sets below break-even" but I honestly don't get it.
I'm not great with numbers so all the formulas are confusing me.
Here are my product details:
- Product price: $44.99
- Product cost (including shipping from supplier): $14.50
- I'm using Shopify with normal fees
- I'm only doing paid traffic (Facebook + a bit of TikTok later)
I have 2 questions:
1. How do I calculate my break-even ROAS in the simplest possible way?
2. When I'm testing ads, how much should I spend before deciding to kill an ad set that's under break-even?
I feel like I'm just guessing based on "vibes" right now and I know that's not how a real business should run.
I'm not great with numbers so all the formulas are confusing me.
Here are my product details:
- Product price: $44.99
- Product cost (including shipping from supplier): $14.50
- I'm using Shopify with normal fees
- I'm only doing paid traffic (Facebook + a bit of TikTok later)
I have 2 questions:
1. How do I calculate my break-even ROAS in the simplest possible way?
2. When I'm testing ads, how much should I spend before deciding to kill an ad set that's under break-even?
I feel like I'm just guessing based on "vibes" right now and I know that's not how a real business should run.
3 Replies
•11/20/2025
This is honestly the first time ROAS actually makes sense to me.
The "how much can I afford to pay for one sale" explanation clicked. I'm going to calculate that number for all my products and use the 2x rule you mentioned for killing ad sets.
Appreciate you breaking it down without all the guru jargon.
The "how much can I afford to pay for one sale" explanation clicked. I'm going to calculate that number for all my products and use the 2x rule you mentioned for killing ad sets.
Appreciate you breaking it down without all the guru jargon.
•11/20/2025
To make it even more caveman-friendly (this helped me a lot):
1. Figure out how much you can afford to pay to get ONE sale. For you it's about $29.
2. While testing, any ad set that spends more than $29 without a sale is already suspicious.
3. Any ad set that spends more than ~$60 with no sale = trash it.
Forget the fancy dashboards in the beginning. Ask yourself:
"How much did I spend?" vs "How many sales did I get?"
If you spent $90 and got 1 sale on a $44.99 product, you KNOW it's bad without any fancy metrics.
1. Figure out how much you can afford to pay to get ONE sale. For you it's about $29.
2. While testing, any ad set that spends more than $29 without a sale is already suspicious.
3. Any ad set that spends more than ~$60 with no sale = trash it.
Forget the fancy dashboards in the beginning. Ask yourself:
"How much did I spend?" vs "How many sales did I get?"
If you spent $90 and got 1 sale on a $44.99 product, you KNOW it's bad without any fancy metrics.
•11/20/2025
Alright, super simple version:
**1. Figure out your profit per sale BEFORE ads**
Sale price: $44.99
Product + shipping: $14.50
Payment fees (rough estimate): around 3% of sale = ~$1.35
Rough profit before ads:
$44.99 - $14.50 - $1.35 ≈ **$29.14**
Call it **$29** to keep it simple.
This $29 is what you can use to pay for ads.
**2. Break-even ROAS formula**
ROAS = Revenue ÷ Ad spend
Break-even ROAS = Sale price ÷ Profit after product costs?
Easier way:
Break-even ROAS = Sale price ÷ (Profit BEFORE ads)
But that gets messy. So here's the version most media buyers actually use:
Break-even ROAS = Sale price ÷ (Sale price - Product cost - Fees)
For you:
Sale price = 44.99
Total cost (product + shipping + fees) ≈ 14.50 + 1.35 = 15.85
Profit before ads ≈ 44.99 - 15.85 = 29.14
Break-even ROAS = 44.99 ÷ 29.14 ≈ **1.54**
So if your ROAS is:
- Below 1.54 = you're losing money
- At 1.54 = you're break-even
- Above 1.54 = you're making profit
**3. When to kill an ad set**
During testing, you don't need to be super strict, but here's a simple rule:
- If an ad set has spent **2x your profit before ads** (so ~$60) with **0 sales**, kill it.
- If an ad set has **1 sale** but overall ROAS is way below 1.5 after a few days, consider killing or pausing it.
The goal of testing isn't to make profit right away. It's to:
- Find combos (audience + creative) that CAN hit break-even or better
- Then you scale those and cut the rest.
If you just remember one thing:
> With your numbers, any ad set that can consistently stay above **1.6 ROAS** is worth keeping and testing more. Anything permanently under 1.5 is a slow leak.
**1. Figure out your profit per sale BEFORE ads**
Sale price: $44.99
Product + shipping: $14.50
Payment fees (rough estimate): around 3% of sale = ~$1.35
Rough profit before ads:
$44.99 - $14.50 - $1.35 ≈ **$29.14**
Call it **$29** to keep it simple.
This $29 is what you can use to pay for ads.
**2. Break-even ROAS formula**
ROAS = Revenue ÷ Ad spend
Break-even ROAS = Sale price ÷ Profit after product costs?
Easier way:
Break-even ROAS = Sale price ÷ (Profit BEFORE ads)
But that gets messy. So here's the version most media buyers actually use:
Break-even ROAS = Sale price ÷ (Sale price - Product cost - Fees)
For you:
Sale price = 44.99
Total cost (product + shipping + fees) ≈ 14.50 + 1.35 = 15.85
Profit before ads ≈ 44.99 - 15.85 = 29.14
Break-even ROAS = 44.99 ÷ 29.14 ≈ **1.54**
So if your ROAS is:
- Below 1.54 = you're losing money
- At 1.54 = you're break-even
- Above 1.54 = you're making profit
**3. When to kill an ad set**
During testing, you don't need to be super strict, but here's a simple rule:
- If an ad set has spent **2x your profit before ads** (so ~$60) with **0 sales**, kill it.
- If an ad set has **1 sale** but overall ROAS is way below 1.5 after a few days, consider killing or pausing it.
The goal of testing isn't to make profit right away. It's to:
- Find combos (audience + creative) that CAN hit break-even or better
- Then you scale those and cut the rest.
If you just remember one thing:
> With your numbers, any ad set that can consistently stay above **1.6 ROAS** is worth keeping and testing more. Anything permanently under 1.5 is a slow leak.