ACoS Break-Even Calculator
Break-even ACoS is your gross margin. That is the whole insight, and it is why the maths is simpler than most sellers expect. If 35% of your selling price is profit before advertising, then spending 35% of the sale price on ads leaves you exactly nothing.
The number matters because ACoS on its own is meaningless. A 40% ACoS is excellent on a product with 60% margins and ruinous on one with 25%. Enter your price and all-in cost below to get your own figure, and the target ACoS for each level of margin you might want to protect.
Free, no signup, runs entirely in your browser — nothing you type is sent anywhere. Last updated .
Your unit economics
Cost should include everything except advertising — landed cost of goods, marketplace referral fee and fulfilment.
| Net margin you want to keep | Target ACoS | Ad budget per sale |
|---|---|---|
| 5% | 33.3% | $9.99 |
| 10% | 28.3% | $8.49 |
| 15% | 23.3% | $6.99 |
| 20% | 18.3% | $5.49 |
| 25% | 13.3% | $3.99 |
Break-even
At 38.3% ACoS you make nothing on an ad-driven sale. Every point below that is margin you keep.
Method
How this is calculated
No fee tables and no assumptions — this is arithmetic on the two numbers you enter, so the result is exact for the inputs you give it.
- 1
All-in cost means everything except ads
Landed cost of goods, marketplace referral fee, fulfilment fee, and any per-unit cost you carry such as inserts or prep. Leave advertising out. Sellers who forget the referral fee here typically overstate their break-even ACoS by 15 percentage points and then wonder why a 'profitable' campaign lost money.
- 2
Gross profit is price minus that cost
This is the pot of money each sale generates before you spend anything acquiring the customer. It is the entire budget available for advertising.
- 3
Break-even ACoS = gross profit ÷ price × 100
ACoS is defined as ad spend divided by ad revenue. Setting ad spend equal to gross profit and dividing by price gives the same figure as your gross margin percentage. The two numbers are always identical — if someone quotes a break-even ACoS that differs from the gross margin, one of the inputs is wrong.
- 4
Target ACoS = break-even minus margin wanted
Because both figures are percentages of the same selling price, they subtract directly. A product with a 40% break-even ACoS, advertised at 25% ACoS, nets 15% margin on ad-driven sales. When the table shows 'not achievable', the margin you asked for exceeds the margin the product has.
- 5
What this does not account for
Organic halo, repeat purchase and lifetime value all justify running above break-even deliberately, particularly at launch. This calculator answers the single-sale question only. If you are buying rank on purpose, break-even is the line you are choosing to cross, not the line you must stay under.
Using the number
ACoS, TACoS, and which one to manage to
ACoS measures ad spend against ad-attributed revenue only. TACoS — total advertising cost of sale — measures the same spend against your total revenue, organic included. Break-even ACoS tells you the ceiling for a single ad-driven sale. TACoS tells you whether advertising is growing the business overall.
A healthy pattern is ACoS near break-even during launch, falling well below it as organic rank builds, with TACoS trending down across both. Rising TACoS alongside flat ACoS usually means ads are cannibalising sales you would have won organically.
If your break-even ACoS comes out under about 20%, advertising is rarely the real problem. Check the fee side first with the FBA fee calculator, because a size tier or category percentage is more likely to be eating the margin than your bids are.
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