Question 1

What is breakeven ROAS and how do I calculate it?

Accepted Answer

Breakeven ROAS is order revenue divided by the contribution each order earns before marketing. If an order brings $34.50 of revenue and $11.50 of contribution after COGS, fees, fulfillment, and returns, breakeven ROAS is 3.0x: any campaign below that loses money regardless of what the dashboard celebrates.

Question 2

How much profit should an e-commerce order make?

Accepted Answer

Healthy operations keep 25 to 40 percent of order revenue as contribution before marketing, leaving room for ads and overhead. If contribution is under 15 percent, no amount of ad optimization makes the business work; the fix is price, AOV, or fulfillment cost.

Question 3

Why am I losing money despite a good ROAS?

Accepted Answer

Platform ROAS compares ad spend to revenue, not to contribution. Fees, shipping, pick and pack, and returns commonly take 40 to 60 percent of revenue before ads. A 2.5x ROAS on a business with a 3.2x breakeven loses money on every paid order.

E-Commerce Order Profit Calculator

The Average Order

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What One Order Earns

Full Order P&L Full Report

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