ROAS isn't profit
01A 3× ROAS sounds great until GST, product and shipping come out. Compare ROAS with your own break-even, never with someone else's.
Free tools · Built for Australian stores
ROAS calculator that starts from your margin.
Work out your ROAS, then the ROAS your store actually needs. Free calculators for Meta and Google ads, with GST and Shopify Payments fees built in. Enter your store numbers once and every calculator below uses them.
Your ROAS, in one line.
Divide the sales your ads brought in by what you spent on them. Then see how that compares with the ROAS your margin needs to break even.
Break-even is 2.26× on A$90 orders. Edit store numbers
ROAS3.00×A$3.00 in sales per A$1 of ads
As a percentage300%
Break-even ROAS2.26×From your store numbers
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Above break-even, so first orders are making money.
How it's worked out
ROASsales ÷ ad spend
ROAS %ROAS × 100
Break-even ROASorder value ÷ left per order
A ROAS of 3× means every A$1 of ads brought in A$3 of sales. That's revenue, not profit: GST, product, shipping and fees still come out of it. Whether 3× is good depends on your margin, which is what break-even ROAS (01) works out.
The return your ads need.
Where each order's money goes, and what's left to spend on winning it. Add the profit you want to keep and you get a target ROAS to set in Meta and Google.
Break-even means a first order pays for its ad and nothing more. Target leaves the profit above in your pocket.
Using A$90 orders with A$39.90 left before ads. Edit store numbers
Break-even ROAS2.26×
Most you can pay per saleA$39.90Break-even CPA
Target ROAS2.84×A$8.18 profit kept per order
Target cost per saleA$31.72Target CPA
Where one order goes
How it's worked out, with your numbers
ROAS stays on the platforms' basis. Meta and Google report sales at the price customers pay, so the order value includes GST. Costs come off the ex-GST amount, because GST was never yours.
Ad spend is ex GST. If your business is registered for GST you claim the GST on ad invoices back, so it isn't a cost.
Refunds are treated as lost sales. If returned stock goes back on the shelf, your real number is a little better.
Is this campaign making money?
Put in what you spent and the ROAS the platform reports. See the profit after GST, product, shipping and fees, not just the revenue.
Adjust for attribution
Platforms claim some sales that would have happened anyway. If your MER check (07) says they over-claim, take some off here.
Break-even is 2.26× on A$90 orders. Edit store numbers
Profit after adsA$990A$9,000 in reported sales
Orders100
Profit per A$1 of adsA$0.33
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Making money on first orders.
Profit after ads at every ROASHover or use arrow keys
How it's worked out
Salesspend × ROAS
Orderssales × believed % ÷ order value
Profit after adsorders × left per order − spend
Profit per A$1profit ÷ spend
This is first-order profit: it ignores customers coming back. A campaign that breaks even here can still be worth running if customers return, which is what customer value (05) works out.
What to spend to hit a sales goal.
Work backwards from the sales you want: how many orders that is, how many clicks it takes, and the budget at your cost per click.
Find cost per click in Ads Manager, and the conversion rate of ad traffic in Shopify analytics. New accounts: start with a conservative guess.
Using A$90 orders with A$39.90 left before ads. Edit store numbers
- BudgetA$8,000
- Clicks8,889
- Orders222
- SalesA$20,000
ROAS you'd get2.50×
Cost per saleA$36
Profit after adsA$866
✓
This plan makes money on first orders.
How it's worked out
Ordersgoal ÷ order value
Clicksorders ÷ conversion rate
Budgetclicks × cost per click
Break-even cost per clickleft per order × conversion rate
Costs per click rise as you spend more, because the platforms run out of the cheapest people to reach. Treat the budget as a starting point for a test, then let real results set the next month.
Which number to fix first.
Cheaper reach, better ads, a better store or bigger orders. See which improvement puts the most profit back for every A$1,000 you spend on ads.
A 20% better conversion rate is worth exactly the same as 20% better click-through. But it also lifts your email, search and repeat sales, which is why we fix the store as well as the ads.
Using A$90 orders with A$39.90 left before ads. Edit store numbers
Cost per clickA$1.00
Cost per saleA$40
ROAS2.25×
Profit per A$1,000 of ads−A$3
Extra profit per A$1,000 of ads
!
Each A$1,000 of ads loses A$3 after costs right now.
How it's worked out
Cost per clickCPM ÷ (1,000 × CTR)
Cost per salecost per click ÷ conversion rate
Orders per A$1,0001,000 ÷ cost per sale
Profit per A$1,000orders × left per order − 1,000
Bigger orders assume product cost grows with the basket (more items) while shipping per order stays the same. Cheaper reach usually comes from better creative and targeting; a better store from conversion work.
What a customer is really worth.
First orders often only break even. Repeat orders are where the profit is. See how much you can pay for a customer, and how fast they pay you back.
Repeat orders come through email, search and coming back direct, so they don't cost another ad click. Good email flows raise this number.
Using A$39.90 left per order. Edit store numbers
Profit, first order−A$5.10
Profit, 12 monthsA$18.84
Pays back in2.6 months
LTV : CAC1.4 : 1
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Over 12 months you can pay up to A$63.84 for a customer and still break even.
Profit per customer over the first yearHover or use arrow keys
How it's worked out
12-month valueleft per order × orders
Profit, 12 months12-month value − CAC
Most you can pay for a customer12-month value
LTV : CAC12-month value ÷ CAC
Repeat orders are spread evenly across the year, at the same order value and margin. We use 12 months on purpose: lifetime figures stretched over three or five years flatter the maths and don't pay this quarter's ad bill.
Before you run 20% off.
Discounts come straight out of your margin, not your price. See how many more orders a sale needs just to make the same profit.
Using A$90 orders with A$39.90 left at full price. Edit store numbers
Extra orders needed+62%
Orders to match162instead of 100
Left per order on saleA$24.66
Break-even ROAS on sale2.92×
!
At 20% off you need 62% more orders just to make the same profit.
Extra orders needed at each discountHover or use arrow keys
How it's worked out
Sale priceorder value × (1 − discount)
Left on salesale price − GST − costs
Extra orders neededleft at full price ÷ left on sale − 1
Product and shipping costs don't shrink when the price does, so every dollar off comes out of what's left. A sale can still be worth it to win new customers who come back at full price; check what they're worth in customer value (05).
Check the platforms' homework.
Meta and Google both take credit for the same sales. Compare what they report with what Shopify actually took, and see whether your ads pay their way overall.
Use the same month for every number. Purchase conversion value in Meta Ads Manager; conversion value in Google Ads.
Break-even MER is 2.26×, the same as your break-even ROAS. Edit store numbers
MER5.00×Break-even 2.26×
Profit after all adsA$14,598
Platforms claim87%of all your sales
Sales recorded vs sales claimed
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The platforms claim 87% of all your sales.
How it's worked out
MERstore sales ÷ total ad spend
Profit after all adssales × (left ÷ order value) − spend
Platforms claim(Meta + Google) ÷ store sales
MER counts every sale, including email, organic and repeat customers, so it's the honest referee. If MER holds as you spend more, the ads are working. If the platforms' ROAS climbs while MER falls, they're taking credit for sales you'd have made anyway.
How we read the numbers
Four rules. Every account.
The calculators give you the maths. These are the habits that stop the maths from being misread.
Platforms grade themselves
02Meta and Google each count the sales they touched, so one order can be claimed twice. MER, from Shopify's own numbers, settles it.
Weeks, not days
03New campaigns go through a learning period. Judge on two to four weeks of data, not one bad Tuesday.
The store is half the maths
04Conversion rate and order value move every number on this page. A better store makes every ad dollar go further.
Questions
Good questions. Straight answers.
How do you calculate ROAS?
Divide the sales your ads brought in by what you spent on them. A$9,000 in sales from A$3,000 of ad spend is a ROAS of 3, written 3× or 300%.
ROAS measures revenue, not profit, so compare it with your break-even ROAS to see whether the ads are making money. Calculator 00 does both.
What is a good ROAS for a Shopify store?
There's no single good ROAS. A good ROAS is one above your break-even ROAS, and that comes from your margin. A store keeping 40% of each order after costs breaks even at 2.5×; a store keeping 20% needs 5×.
Work out your own break-even with calculator 01 before comparing with anyone else's numbers.
How do you calculate break-even ROAS?
Take the order value and subtract GST, product cost, shipping, payment fees and refunds. What's left is the most you can pay for a sale: your break-even CPA. Break-even ROAS is the order value divided by that amount.
For a A$90 order with A$39.90 left after costs, that's 90 ÷ 39.90 = 2.26×.
What's the difference between ROAS and MER?
ROAS is what one ad platform says its ads brought in, divided by what you spent there. MER (marketing efficiency ratio) is your total store sales divided by your total ad spend across every platform.
ROAS helps you manage campaigns. MER, taken from Shopify's own numbers, tells you whether advertising pays for itself overall.
Should GST be included when working out ROAS?
Ad platforms usually report sales at the price customers pay, which in Australia includes GST. Your margin doesn't include it, because GST belongs to the ATO.
These calculators keep ROAS on the same basis the platforms report it, and take GST out before working out what you keep. If your prices don't include GST, switch it off under Payment fees & GST.
What's the most I should pay to get a customer?
On the first order alone, no more than what's left after costs: your break-even CPA. If customers come back, you can pay more, because repeat orders don't cost you another ad click.
Customer value (05) shows how much you can pay over 12 months and how long it takes to get it back.
Why don't Meta and Google numbers match Shopify?
Each platform counts the sales it touched within its own attribution window, including some people who only saw an ad. When a shopper sees a Meta ad and later clicks a Google ad, both can claim the same order. Privacy settings and blocked tracking also hide some sales.
That's why we set tracking up first, and why the MER check (07) compares the platforms' claims with Shopify's total.
How accurate are these calculators?
The maths is exact for the numbers you enter, but those numbers are averages and real campaigns move around. Use the results to set targets and spot problems, not as a promise.
Your numbers stay in your browser and are never sent to us.