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What ROAS do you actually need to break even?
Every store has a multiple it must clear before an ad contributes anything. Put your numbers in and find out what the campaign really made after goods, fees, shipping and returns.
Your numbers
Defaults are typical DTC figures, not your store's. Cost of goods moves the answer most — if you change one, change that.
True contribution
−$315.11
This campaign lost money.
Break-even ROAS
3.86×
Your ROAS
3.20×
Why ROAS lies
Return on ad spend divides revenue by ad spend. Revenue is not money you keep. If goods cost 58% of the sale price you are down to 42 cents on the dollar before a single fee, and processing, shipping and returns come out of what's left.
That is why a campaign can post a confident 3.2× and still hand you a loss. The number that matters is break-even ROAS — the multiple you need before the campaign contributes anything. Above it you're building the business; below it you're buying revenue.
How it's calculated
Take sales and subtract everything that varies with the sale — goods, fees, shipping, returns — but not ad spend. That's contribution before advertising. Break-even ROAS is sales divided by that figure. At 58% COGS and typical fees it lands near 3.9×, which surprises most people the first time.
What it doesn't include
Fixed costs — salaries, software, rent — sit outside this, and so does lifetime value: a first order at a small loss can be fine if those customers come back. This measures one campaign's contribution, which is the right question when deciding whether to scale it or kill it.
Doing this for every campaign, every week?
Redline pulls these numbers out of your Shopify store automatically and tells you the day a profitable campaign crosses into loss. Free during the beta.
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