The break-even ACoS formula
break-even ACoS = pre-ad margin ÷ ad-attributed sales × 100
pre-ad margin = (price − platform fee − fulfillment − COGS) × units sold
Worked example
| Line | Value |
|---|---|
| Ad-attributed sales | $400 (16 units × $25) |
| Margin per unit ($25 − $3.75 fee − $4.50 fulfillment − $10 COGS) | $6.75 |
| Total pre-ad margin | $108.00 |
| Break-even ACoS | 27.0% |
Spend $108 on ads that drove those $400 in sales and the campaign ends at exactly zero. Above 27%, ads are eating product margin; below it, they are printing money. The calculator draws this line automatically from your inputs.
Why “spend ÷ price” formulas mislead
A popular shortcut defines break-even ACoS as margin ÷ selling price. It ignores that marketplace fees scale with price, fulfillment is charged per unit, and returns quietly eat margin. Using the sell-price shortcut on the example above gives 27% by luck of the numbers — change fulfillment to $6.50 and it still says 27% while the true line drops to 22%. Always divide by ad sales, with every per-unit cost inside the margin.
How to use the line
- Campaign triage: any campaign above break-even ACoS for its full attribution window is a candidate to pause, lower bids or restructure.
- Bid ceiling: combine with the max-CPC reverse calculator so no bid can exceed what the target ACoS allows.
- Launch pricing: if your realistic ACoS sits above the line, fix the margin (price or COGS) before scaling spend.