ROAS (Return on Ad Spend) measures revenue generated per advertising dollar, and Doba's free calculator finds your break-even ROAS, break-even ACoS, and max cost per order based on your real product costs. In plain terms, if a $10 ad brings back $30 in sales, that's a 3x ROAS. Whether that number is actually good depends entirely on what the product costs you to sell, which is where break-even ROAS comes in.
This post covers the full formula and the reasoning behind as we discussed in How to Calculate Break-Even ROAS for Dropshipping Campaigns. Since writing that, however, our team here at Doba got together and created a few free dropshipping tools — including this ROAS calculator. Here, we’ll cover what to enter, what each output means, and a worked example so you can see how it plays out on a real product.
Setting Up a Product to Test
Say you're weighing whether to run ads on an insulated water bottle sourced through Doba. Your supplier charges $9 per unit, you're planning to ship it yourself for $4, your sales channel takes 5% in fees, and you're pricing it at $32. Before committing any ad budget, you want to know the ROAS that number actually requires.
Product cost. What you pay your supplier per unit. That's $9 for the bottle.
Sell price. What the customer pays. You're testing $32.
Shipping cost. What it costs you to ship the order, if you're covering it. That's $4.
Platform and transaction fees. Entered as a percentage of the sale price. The channel you're using takes 5%.
Your current ROAS. Optional. If you already have live ad data, enter it here to see your actual profit at that return. Say your campaigns are currently running at 3.5x.
Target net margin. Optional. Enter a margin goal and the calculator works out the ROAS needed to hit it. You're aiming for 20%.
Running the Numbers
Here's what comes back for the water bottle:
That $17.40 is what's left of every $32 sale before advertising comes out of it. It's the entire budget you have to work with per order, and it's the number the rest of the calculator is built on.
What the Three Outputs Mean
Break-even ROAS is the return your ads need to hit before an order stops losing money. It's revenue divided by contribution, so for the water bottle that's $32 ÷ $17.40, or about 1.84x. Below 1.84x, each sale costs more in ads than it brings back. Above it, the order is profitable.
Break-even ACoS is the same idea expressed as a percentage of revenue instead of a multiple. It's the most you can spend on ads without losing money, shown as a share of the sale. For the bottle, that's 54.4% (contribution divided by revenue) — spend more than 54.4% of the $32 on the ad that won the sale, and the order goes negative.
Max cost per order is that same ceiling in dollars rather than a percentage. For the water bottle, that's $17.40. Any ad cost above that number turns the sale into a loss, no matter how the percentage is framed.
At the current 3.5x ROAS, ad spend on the bottle works out to about $9.14 per order ($32 ÷ 3.5), leaving $8.26 in net profit and a 25.8% net margin — comfortably above the 1.84x break-even floor. To hit the 20% target margin instead, the calculator works backward from a $6.40 profit goal (20% of $32) and returns a target ROAS of about 2.91x.
Break-Even ROAS vs. Target ROAS for Dropshipping Ads
These two numbers answer different questions. Break-even ROAS is the floor: the return below which every sale loses money, no exceptions. Target ROAS is a goal set above that floor, built around the profit margin you actually want, not just the one that keeps you from losing money.
For the water bottle, 1.84x is the line that can't be crossed. 2.91x is the return that gets to a 20% margin. A campaign running at 2.2x is technically profitable since it clears break-even, but it's well short of the target, and that gap is exactly what target ROAS is meant to surface before a campaign scales on numbers that only look healthy.
A Good ROAS for Dropshipping Isn't a Fixed Number
There's no universal answer to what counts as a good ROAS, because it depends entirely on the product's own contribution margin. A 3x ROAS is strong for a product with a 1.84x break-even, and it's a loss for a product whose costs push break-even to 3.5x. The only benchmark that means anything is a product's own break-even ROAS, not a number pulled from a different store or a different category.
Try It on Your Own Numbers
Running these numbers before turning on ads is what keeps a campaign's ROAS target grounded in the actual product instead of a guess. Enter your own cost, price, and fees, and the calculator shows the same three outputs walked through above.
Try Doba's break-even ROAS calculator
For the full break-even ROAS formula and more on how it applies across different ad platforms, see How to Calculate Break-Even ROAS for Dropshipping Campaigns. Doba's full library of free tools also includes the dropshipping profit calculator for checking margins before you get to the ad math.
