TikTok Shop ROAS Calculator
What ROAS do you actually need to break even — and what do you keep at your reported ROAS?
Inputs
Referral fee effective 2024-04-01 · FBT rate card effective 2026-07-13 · last checked by hand 2026-09-29 · Sources: US commission policy, FBT rate card
Quick answer
On the default $29.99 product — $6.50 COGS, 10% creator commission, 5% returns — the break-even ROAS is 2.17×. At a reported 3.0× you keep $3.80 per unit (12.7%), or $1,900 a month on 500 units. Set creator commission and returns to zero and the floor drops to 1.75×; push them to 30% and 20% and it jumps to 4.50×. Every figure here assumes the buyer is charged nothing for shipping separately, so the revenue in the formula is the item price alone.
How to read your break-even ROAS
01 / explainerROAS in Ads Manager measures gross revenue per ad dollar — not profit. Three things decide whether a reported ROAS actually makes you money:
Fees come off first
Referral (6%), FBT fulfillment and creator commission all come out before ad spend. On the default product they total $9.32 — 31% of the buyer’s total — before you have paid for the product or the ads.
Break-even ROAS is your floor
It is simply revenue ÷ profit before ads. At the defaults, $29.99 ÷ $13.79 = 2.17×. Anything below that is paid traffic burning cash even while Ads Manager shows a healthy-looking ROAS.
Corrected ROAS is what landed
Reported ROAS counts revenue you later refunded. Corrected ROAS — revenue after returns ÷ ad spend — is the honest number, and it is always the lower of the two.
Scale only above the floor
Budget increases are safe only when the floor is cleared with room to spare for your actual return rate. A business running at 2.5× against a 2.17× floor is not "profitable" — it is one bad returns week away from zero.
Three ROAS numbers, and only one of them pays you
02 / definitionsMost sellers argue about "a good TikTok Shop ROAS" while quoting three different numbers. They are not interchangeable:
| Number | Formula | On the defaults | What it tells you |
|---|---|---|---|
| Reported ROAS | revenue ÷ ad spend | 3.00× | What GMV Max / Ads Manager puts on your dashboard |
| Corrected ROAS | revenue after returns ÷ ad spend | 2.85× | What actually landed once refunds are netted off |
| Break-even ROAS | revenue ÷ profit before ads | 2.17× | The floor you must clear to make any money at all |
Read them together: at a reported 3.00× you are above the 2.17× floor, so the campaign is genuinely profitable — but after returns the real number is 2.85×, and the cushion is thinner than the dashboard implies.
Worked example on the default inputs
03 / worked example$29.99 sale price, $6.50 COGS, 6% referral, 4–8 oz FBT tier (one unit per order), 10% creator commission, 5% return rate at $0.70 handling, 3.0× reported ROAS and 500 units a month. Every figure below is the calculator's own output.
| Line | Amount | % of sale |
|---|---|---|
| Sale price | $29.99 | 100.0% |
| − TikTok platform fees | −$9.32 | 31.1% |
| − COGS | −$6.50 | 21.7% |
| − Return impact | −$0.38 | 1.3% |
| = Profit before ads | $13.79 | 46.0% |
| Break-even ROAS ($29.99 ÷ $13.79) | 2.17× | — |
| − Ad cost at 3.0× ($29.99 ÷ 3.0) | −$10.00 | 33.3% |
| = Net profit per unit | $3.80 | 12.7% |
| Monthly at 500 units | $1,900 | on $5,000 ad spend |
Note how little is left. A 3.0× ROAS sounds like a three-to-one return. It is actually $3.80 a unit — a 12.7% net margin — because TikTok's fees, your COGS and the ads are all paid out of the same $29.99.
What the two deductions are made of
04 / breakdownPlatform fees — $9.32
| Component | How it is charged | At the defaults |
|---|---|---|
| Referral fee | 6% of the buyer’s total payment (item price plus any shipping the buyer pays); TikTok's policy documents no separate transaction fee (US commission policy) | $1.80 |
| FBT fulfillment | Flat per unit, 4–8 oz tier, single item (FBT Rate Card) | $4.52 |
| Creator commission | 10% of the item price, set by you | $3.00 |
| Total platform fees | 31.1% of the buyer’s total | $9.32 |
Return impact — $0.38
| Component | How it is charged | At 5% returns |
|---|---|---|
| Lost product cost | COGS × return rate | $0.33 |
| Refund admin fee | 20% of the referral fee, capped at $5 per SKU, × return rate | $0.02 |
| FBT return handling | $0.70 per returned unit × return rate | $0.04 |
| Total return impact | 1.3% of the buyer’s total | $0.38 |
Component rows are as displayed by the calculator; display rounding can differ by a cent from the total. This page charges returned units against your product cost (COGS) — the same basis the Profit Calculator uses. A return costs you the goods, not the sale price you never collected. One difference: the Profit Calculator lets you set a resale rate for returned stock, while this page has no such input and therefore treats every returned unit as unsellable. That is the conservative end — if you can resell returns, your real return cost is lower than the figure shown here.
Your break-even ROAS is not a fixed number
05 / sensitivitySame product, same price, same weight — only creator commission and return rate change. The floor moves by almost an order of magnitude:
| Creator commission | Return rate | Profit before ads | Break-even ROAS |
|---|---|---|---|
| 0% | 0% | $17.17 (57.3%) | 1.75× |
| 10% | 5% | $13.79 (46.0%) | 2.17× |
| 20% | 10% | $10.42 (34.7%) | 2.88× |
| 30% | 20% | $6.66 (22.2%) | 4.50× |
This is why "what ROAS should I target?" has no universal answer, and why comparing your ROAS with another seller's is close to meaningless. Two sellers running identical ad accounts can have break-even floors 1.75× and 4.50× apart, purely because one pays creators heavily and eats more returns.
Five ROAS mistakes that cost real money
06 / pitfalls- Reading a positive ROAS as profit. A 2.0× ROAS is a loss on the default product, whose floor is 2.17×. Ads Manager will still show a positive ROAS.
- Treating the floor as fixed. It moves every time you change creator commission, return rate, price or weight tier. Re-run it after any of those.
- Scaling on reported ROAS alone. Check corrected ROAS first — that is the revenue that actually survived refunds.
- Benchmarking against someone else's ROAS. Different COGS, price and creator terms put the two of you on different floors.
- Assuming a price rise makes things worse. It usually lowers your floor: FBT and COGS are fixed, so raising $29.99 to $39.99 drops the break-even from 2.17× to about 1.80×.
FAQ
07 / questionsWhat is a good ROAS for TikTok Shop?
There is no universal number — a good ROAS is one that clears your break-even floor with room to spare. On the default product ($29.99 sale, $6.50 COGS, 10% creator, 5% returns) the floor is 2.17×, and a 3.0× ROAS leaves just 12.7% net margin.
How do I calculate break-even ROAS?
Divide your revenue by your profit before ad spend: revenue ÷ (revenue − platform fees − COGS − return impact). At the defaults that is $29.99 ÷ $13.79 = 2.17×. Below that line, every additional ad dollar loses money.
Why is my corrected ROAS lower than the ROAS GMV Max shows?
Because the reported figure counts revenue you later refunded. Corrected ROAS nets returns off the revenue first. At a 5% return rate the gap is about 5% of revenue — small per order, but it is the difference between a comfortable and a thin margin across a month of ads.
Does creator commission change my break-even ROAS?
Yes, and heavily. Creator commission comes straight off profit before ads, so it raises the floor. Moving from 0% to 30% creator commission on the default product takes the break-even from 1.75× to 4.50× once a 20% return rate is also applied.
Is it safe to scale once I am above break-even?
Only with a cushion. Scaling increases volume, and returns scale with volume too. Check that both reported and corrected ROAS clear the floor, then increase budget in steps and watch whether the corrected number holds.
What is the difference between ROAS and ACOS?
They are reciprocals. ROAS is revenue ÷ ad spend; ACOS is ad spend ÷ revenue. A 3.0× ROAS is a 33% ACOS. Break-even ROAS is simply 1 ÷ your profit-before-ads margin, expressed as a multiple.
Keep going
08 / related- Profit Calculator — per-unit net profit including storage, inbound freight and ad spend.
- Fee Calculator — every TikTok fee line, before COGS.
- TikTok Shop vs Amazon FBA — how the two fee stacks compare on the same product.
- TikTok Shop fees in 2026 — the written guide behind the rate card.
- Break-even ROAS formula, worked step by step — the maths on this page, explained with examples.
- Product research tools by stage — what a monthly subscription costs per unit at your volume.
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