Target ROAS Calculator
Estimate a target ROAS to cover variable costs plus a desired margin buffer.
Prefer an explanation? Read the guide.
Gross margin before marketing (COGS only).
%
As % of revenue (optional).
%
As % of revenue (optional).
%
As % of revenue (optional).
%
If you want ROAS to cover fixed costs, allocate them as % of revenue.
%
Extra buffer as % of revenue (optional).
%
Tip: you can type commas (e.g., 10,000).
Example
Using the default inputs, the result is:
2.7×
- Gross margin
- 60%
- Payment fees
- 3%
- Shipping & fulfillment
- 0%
- Returns & refunds
- 0%
- Fixed cost allocation
- 10%
- Desired profit margin
- 10%
Formula
Target ROAS = 1 ÷ (Contribution margin − Fixed cost allocation − Desired profit margin)
- All inputs are expressed as a percent of revenue.
- Fixed costs are represented as an allocation; this is a planning model (not a full P&L).
FAQ
How do I choose a fixed cost allocation?
Pick a conservative percent based on your business: total fixed costs divided by your expected revenue in the same period. Keep it stable for comparisons.
Why can’t I get a target ROAS?
If contribution margin minus allocations is ≤ 0, your unit economics can’t support the chosen buffers. Reduce fixed/profit allocations or improve margin.
How to interpret
How to set a target ROAS
- Start from contribution margin, then decide how much revenue must cover fixed costs and profit.
- Use different targets by channel if volatility differs.
- Revisit targets when margins or fulfillment costs change.