upriseFor clothing brands · guide + calculator
Break-even ROAS for a clothing brand
Before you judge your ads, know the number they have to beat. Below your break-even ROAS, every sale loses money. Above it, ads are profitable.
Break-even ROAS = price ÷ (price − cost to make − shipping − payment fees). Example: a $45 hoodie that costs $18 to make, $6 to ship and $1.60 in fees leaves $19.40, so break-even ROAS is 45 ÷ 19.40 = 2.32x. Run your own numbers in the calculator.
The formula
ROAS is revenue divided by ad spend. Break-even ROAS is the point where the ad cost eats exactly all the profit on an order.
| Price (average order value) | $45.00 |
| Cost to make | −$18.00 |
| Shipping | −$6.00 |
| Payment fees | −$1.60 |
| Profit before ads | $19.40 |
| Break-even ROAS | 45 ÷ 19.40 = 2.32x |
Example numbers. Use your own.
How to read it
- Below break-even: every ad sale loses money. Fix margins, raise order value, or fix the creative and page.
- At break-even: you're buying customers at cost. Fine only if they come back and buy again.
- Above break-even: profitable. That's where you scale, about 20% at a time.
Max cost per customer
The same math in dollars: max cost per customer = order value − variable costs − any agency fee − the profit you want to keep. If an $80 order leaves $45 after product, fulfillment and fees, the ad cost, the agency share and your profit all have to fit inside that $45.
How to lower your break-even
- Raise average order value: bundles, a second item, a free-shipping threshold
- Cut cost to make or ship at volume
- Raise conversion rate so the same spend brings more orders
Questions
What is a good ROAS for a clothing brand?
Anything comfortably above your own break-even. For the $45 hoodie example that's 2.32x, so 3x is profitable and 2x loses money. There's no universal number, only yours.
Is 2x ROAS good?
It depends on your margins. With high margins 2x can be profitable. With thin margins it can lose money on every order. Calculate your break-even first.
Should I include returns in break-even ROAS?
Yes, if returns are a real share of orders. Lower the profit per order by your average return cost so the number stays honest.
What ROAS should I judge my first test on?
Look at a full 7 days, not one day. Compare it to your break-even and look at cost per purchase, conversion rate and purchase volume together.
Keep going
Demand, margin math, page readiness, then a $3,000 test.
Results dropped? It's one of five things.
The playbook and the break-even ROAS calculator.
Not sure your numbers work?
Pick a time. I'll run your margins with you and tell you if ads can work for your brand.
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