ACoS, TACoS and ROAS —
Clear It Once and For All
90% of Amazon sellers misunderstand ACoS. In this guide, we explain all three metrics with real examples — and show you exactly how to calculate your Breakeven ACoS.
Your ACoS is 35% — is it profitable or are you running at a loss?
Most sellers get this wrong because they don't understand what ACoS actually means.
In this guide, we'll clear ACoS, TACoS and ROAS — once and for all, with real numbers.
All Three Metrics at a Glance
Before we go deep, here's the big picture. All three metrics measure your ad performance — but from different angles.
| Metric | Full Form | Formula | What It Tells You |
|---|---|---|---|
| ACoS Ad Only | Advertising Cost of Sales | Ad Spend ÷ Ad Revenue × 100 | How efficient your ads are |
| TACoS Total | Total Advertising Cost of Sales | Ad Spend ÷ Total Revenue × 100 | Overall business health (ads + organic) |
| ROAS Return | Return on Ad Spend | Ad Revenue ÷ Ad Spend | Revenue earned per ₹1 spent on ads |
Formulas + Examples — Click to Expand
Each formula card below is clickable. Expand it to see the formula, a worked example, and a key takeaway. Use the toolbar to expand or collapse all at once.
For every ₹100 in sales generated by your ads — this is how many rupees you spent on those ads.
Ad Revenue = ₹2,000
ACoS = 500 ÷ 2000 × 100 = 25%
Your ACoS is 25%. But is 25% good or bad? That depends on your Breakeven ACoS — which we cover next.
If your ACoS goes above this number — you are losing money on ads. Calculate this first, then judge your ACoS.
COGS + FBA + Referral = ₹700
Profit = ₹300
Profit Margin = 300 ÷ 1000 × 100 = 30%
Breakeven ACoS = 30%
TACoS = Ad Spend ÷ Total Revenue × 100
(Ad Revenue + Organic Revenue)
ACoS only looks at sales from ads. TACoS looks at your entire business — ads and organic sales combined.
Ad Revenue = ₹3,000
Organic Revenue = ₹2,000
Total Revenue = ₹5,000
ACoS = 1000 ÷ 3000 × 100 = 33%
TACoS = 1000 ÷ 5000 × 100 = 20%
ACoS looks high at 33% — but your TACoS is only 20%. The business is actually profitable. Never make decisions based on ACoS alone.
TACoS going up → Organic sales are shrinking ✗
Start tracking TACoS every week. It tells you whether your business is growing organically — or still heavily dependent on paid ads.
ACoS = Ad Spend ÷ Ad Revenue × 100
ROAS and ACoS measure the same thing — just expressed differently. Use whichever feels more natural to you.
A ROAS of 4x means — for every ₹1 spent on ads, you earned ₹4 in revenue.
ACoS% = 100 ÷ ROAS
ACoS 25% → ROAS = 100 ÷ 25 = 4x
They are the inverse of each other. Whenever someone quotes ROAS and you need ACoS — just divide 100 by it, and vice versa.
What You Learned Today
ACoS tells you how efficient your ads are — but it means nothing without knowing your Breakeven ACoS first.
Calculate your Breakeven ACoS from your profit margin. If your ACoS is below it — ads are profitable. If above — you are losing money.
Always track TACoS, not just ACoS. It shows the real health of your business by including both ad and organic sales.
ROAS is just the inverse of ACoS — same information, different expression. Use whichever you prefer, but never ignore TACoS.
Calculate Your Breakeven ACoS Right Now
Use SelluxPro's free ACoS Calculator. Enter your selling price, COGS, FBA fee and referral fee — your Breakeven ACoS is calculated automatically. Then compare it with your current ACoS.
Free to use · No signup required · Works instantly
