How do I set my break-even ROAS and use it instead of product costs?

Save the ROAS where your ads stop making money, then choose whether profit numbers use your detailed costs or that break-even ROAS.

Set your break-even ROAS

Your break-even ROAS is the ROAS where your ads stop making money. At that ROAS, the sales from your ads just cover your order costs and the ads themselves. For example, if your order costs are half of every sale, every 1 you spend on ads has to bring in 2 in sales, so your break-even ROAS is 2.

The Ads Manager colours ROAS against this number, as explained in What do the colours and the small numbers under a value mean?. Your profit numbers can also use it in place of your costs.

1. Open Setup in the left menu and click Cost Manager.
2. Under Cost of Goods, below the cards Product Cost, Handling Fee, Shipping Cost and Processing Fee, find Break-even ROAS.
3. In the box Your break-even ROAS, click Set. If you saved one before, the box shows it with an Edit button.
4. Type your number in the Break-even ROAS field. Under the field you see what it means, for example 50% of every sale is costs. Green from 2.20x, red below 1.80x. If TrueROAS can work out a value from your recent orders, the window also shows it, for example Your last 30 days of orders work out to 1.67x.
5. Click Save. You will see Saved break-even ROAS.

The value must be above 1 and at most 10. Otherwise the field shows Must be above 1x: at 1x your ads would only pay for themselves or Can't be more than 10x, and you cannot save.

Use the value from your recent orders

The box From your last 30 days of orders works out a break-even ROAS from the costs saved on your orders of the last 30 days: product cost, handling, shipping and payment processing. A line such as Your order costs are 40% of sales. shows the share it is based on.

• When you have not saved a break-even ROAS, or this value differs from yours, a button such as Use 1.67x appears. Click it to save the value. You will see Break-even ROAS set to 1.67x.
• When there is nothing to work it out from, for example no orders in the last 30 days, the box reads Not enough orders with costs yet.
• If your orders cannot be loaded, it reads Couldn't load your recent orders. Refresh to try again.

Choose where your costs come from

Under Count your costs from, pick one of two options. Your choice is saved straight away.

• Automatic (recommended): Your detailed costs when you have them. Until then, your break-even ROAS. You will see Profit now uses your detailed costs when you have them.
• Break-even ROAS only: a quick setup that ignores your detailed costs and counts the same share of every sale as costs, for example 50% at a break-even ROAS of 2. You will see Profit now uses your break-even ROAS.

If you pick Break-even ROAS only before you have saved a break-even ROAS, the Break-even ROAS window opens first with Set your break-even ROAS to count your costs from it. Your choice is saved together with the value when you click Save.

With Automatic (recommended), each profit number uses the first of these that TrueROAS has:

1. The costs saved on the orders behind that number. These are your detailed costs.
2. Your default product cost % from the Product Cost card, applied to the sales.
3. Your break-even ROAS. TrueROAS then counts 1 minus 1 divided by your break-even ROAS of every sale as costs: 50% at 2, 75% at 4.
4. Nothing. No order costs are taken off, and Add cost appears next to the number or in its place.

On the Dashboard, step 1 needs a product cost or a handling fee on the orders. When they only carry shipping and payment processing costs, TrueROAS uses step 2 or 3 if it can, so missing product costs do not make your profit look too high.

While your profit uses your break-even ROAS because you have no detailed costs yet, a notice above the cost cards in Cost Manager says, for example, No detailed costs yet, so your profit uses your break-even ROAS (2x). Add costs below and they are used automatically.

With Break-even ROAS only, every profit number on the Dashboard and in the Ads Manager uses your break-even ROAS, even where your orders have detailed costs. Your detailed costs stay saved. In Cost Manager the cost cards are dimmed, and a notice above them starts with Not used right now. Click Use my detailed costs in that notice to go back to Automatic (recommended).

The box Your profit uses at the bottom of the panel names what your profit numbers use right now: Your detailed costs, Your product cost % (30%), Break-even ROAS 2x or Nothing yet. Whether you have detailed costs is judged from your orders of the last 30 days. The box also says Monthly custom costs are not part of break-even ROAS. They are subtracted separately in Blended Profit. See How do I add monthly costs like apps, rent or payment fees?.

What est. and Add cost mean

Next to a profit or cost number, such as the POAS in ROAS / POAS, COGS, Blended Profit, Contribution Margin or the Product costs row in Cost Breakdown, you may see a small grey est. or Add cost link. Both open Cost Manager.

• est. means the number is estimated. Hover over it to see what it is based on:
  • Estimated from your default cost %. Add product costs for exact numbers.
  • Estimated from your break-even ROAS. Add product costs for exact numbers.
  • From your break-even ROAS, because you chose it instead of your detailed costs. Change this in the Cost Manager.
  • Next to COGS in the Summary row of the Ads Manager: Estimated. Add product costs for exact numbers.
• Add cost means there are sales but no costs and nothing to estimate from, as in step 4 above. Saving a break-even ROAS or a default product cost % turns it into an estimate marked est.

Good to know

• Your break-even ROAS and your choice under Count your costs from are saved for the whole store, so everyone on the store sees the same profit numbers.
• You cannot set a different break-even ROAS for each campaign or product.