Break-Even ROAS Calculator for Service Businesses

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2.01Break-even ROAS: every $1 of ads has to bring back this much in paid work

$174.50Amount left from each sale before advertising costs. 49.9% of each sale

$174.50Maximum you can pay to acquire one customer through ads

–Target ROAS needed to earn your chosen profit (enter a profit to see it)

The formula

How it's worked out

Break-even ROAS = 1 ÷ your margin before ad spend

It's the same formula Shopify uses in its own guide.

Here's an example using a $350 job. Materials cost $60. Staff pay takes 30% of the sale, or $105. Card processing fees take another 3%, or $10.50.

That leaves $174.50 before advertising costs. Your margin is 49.9%.

1 ÷ 0.499 = 2.01

For every $1 you spend on advertising, you need $2.01 in paid work to break even.

You can afford to spend up to $174.50 to acquire that customer. Spend more and the first job loses money.

Reported vs real

What your ad platform's ROAS leaves out

Meta and Google report the sales they attribute to your advertising. But those figures don't necessarily reflect the money that actually reached your bank account.

Some customers cancel. Others don't show up. And sometimes the final payment is less than the original quote.

Those differences matter.

The profit dashboard

Our profit dashboard compares your advertising spend with jobs and appointments that were actually paid for.

Every month, you see what each advertising channel returned, checked against your break-even figure.

See the profit dashboard

Questions

Straight answers.

What is a good ROAS?

It depends on how much of each sale you keep before advertising costs.

If your margin is 50%, you break even at a ROAS of 2.0. If your margin is only 25%, you need a ROAS of 4.0.

Anything above your break-even figure contributes to profit. Anything below it means you're losing money on the work generated by those ads.

How do you calculate break-even ROAS?

Divide 1 by your margin before advertising, expressed as a decimal.

For example, if you keep 40% of each sale once products, staff pay and card fees are paid: 1 ÷ 0.40 = 2.5.

Your break-even ROAS is 2.5. That means you need $2.50 in sales for every $1 spent on advertising.

What's the difference between ROAS and break-even ROAS?

ROAS measures what your advertising brought back in sales compared with what you spent.

Break-even ROAS tells you the minimum return needed to cover your advertising and job-related costs.

Compare the two figures every month. A high reported ROAS isn't much use if you're still losing money on the jobs.

Should I count staff pay?

Yes, if the cost increases when you take on another job.

Include commissions and wages for the hours spent completing that work.

Leave out fixed overheads such as rent. Those still have to be paid, but they're deducted from your remaining profit rather than included in this break-even calculation.

See your real return on ad spend every month.

Our profit dashboard shows what each advertising channel actually brought back, compared with your break-even ROAS. Figures are checked against your bank transactions and booking or job records.