Why do I get lots of orders and lose money?

Because an order isn't profit. An order becomes profit after you deduct product cost, shipping, payment, packaging and ads, and after you remove the orders that came back. In COD a returned order costs you shipping both ways for nothing, so you can sell more and make less.

How do I calculate my break-even point?

Subtract product cost and all variable costs from the selling price, and the result is your margin. Break-even ROAS = 1 ÷ margin. Example: selling price 500 EGP and costs 350, so margin is 30% and break-even ROAS is 3.33.

What ROAS counts as good?

There's no absolute number. It depends on your margin. A ROAS of 2 is excellent for a business with a 60% margin and a disaster for a business with a 25% margin. What matters is the gap between the number and your break-even point.

Ads Manager says ROAS 4 and I don't see the money. Why?

Three common reasons: the number comes from a wide attribution window crediting the ad with sales it wasn't the only cause of, or it counts recorded orders rather than delivered ones, or your margin is thinner than you think. Always match it against the money in your back end.

What do I do if I'm under my break-even point?

Don't raise the budget. You have three levers cheaper than ads: raise average order value with a bundle, improve the conversion rate on the product page, or reduce returned orders with faster confirmation. All three move the break-even point toward you without spending one extra pound.

I Get Orders and I Lose Money: How to Calculate Your Real Profit From Ads

There's a question store owners keep asking me in different forms, but it's the same question: "This month we had better sales than last month, and there's still no money. Where did it go?"

The short answer: the money didn't go anywhere. It never came in to begin with. You were looking at a number that doesn't measure profit.

Ads Manager shows you revenue, not profit

Ads Manager sees only one thing: the value of the order recorded after the click. It doesn't know:

What the product cost you
What shipping cost you
Whether the order arrived or came back
Payment fees, packaging and returns

So when it tells you "you made 100 thousand," it's saying income, and you're hearing profit. The difference between the two is the whole business.

The only number that matters: break-even ROAS

There's one number that makes every decision after it easier once you know it. It's called break-even ROAS, the lowest ROAS where you neither make nor lose money.

It's calculated simply:

Break-even ROAS = 1 ÷ your margin

And margin = (selling price − all variable costs) ÷ selling price.

An example with numbers. A product you sell for 500 EGP:

Product cost: 250
Shipping: 60
Packaging and fees: 40
Total costs: 350
Margin: 150 EGP = 30%

So break-even ROAS = 1 ÷ 0.30 = 3.33.

That means any campaign giving you a ROAS below 3.33 is losing money, even if it looks successful and even if orders are growing. And for any campaign above 3.33, the gap is your real profit.

Take a moment now and calculate your own number. Most people are surprised that it's much higher than they thought. If you want to calculate it without paper, there's a break-even calculator on the site. And if you have the actual CPA from your campaign report and want to know whether you're making or losing money on it right now, use the real profit calculator.

In Egypt there's a second layer: the order that never arrives

If you sell by cash on delivery, the formula above isn't enough. Your order doesn't become money the moment it's recorded. It becomes money when it arrives and the customer pays.

And a returned order isn't zero. It's negative: you paid for its ad, for shipping out, and for shipping back. So it pulls from the profit of another order that succeeded.

If your delivery rate is 70%, you effectively need to sell 10 to collect the price of 7, and the ad cost was paid on all ten. That raises your real break-even ROAS by a large margin.

In the fashion brand case that reached 44 million EGP, the ads weren't what made the big spend possible in the first place. A private shipping company that raised the delivery rate to 75% was. Without it, half of every pound spent would have come back.

Read COD in Egypt and why it changes all your numbers if this is your situation.

So if I'm under my break-even point, what do I do?

First, don't raise the budget. More spend on a losing equation only grows the loss without fixing it. Read Why raising the budget isn't always the answer.

You have three levers, all cheaper than ads because they don't need one extra pound:

1. Raise your average order

When the order value rises, your margin in pounds rises and your break-even point falls. A bundle is the fastest way: instead of selling one piece at 500 with a 150 margin, you sell two at 850 with a 250 margin. Same customer, same ad.

In the Gulf store case, sales of the main bundle rose 133% and AOV settled at 79.91 dollars, with discounts of just 0.64%. The details are in Raising order value.

2. Improve your conversion rate

You pay for the visit, not the order. So if the same visits convert at double the rate, your cost per order is cut in half.

In the same case the CVR was 0.7%: out of every 1000 paid visitors, only 7 buy. After the product page was rebuilt it became 1.19% in two months. That's no cosmetic improvement. That is a far lower cost per order.

Compare your number with the ecommerce benchmarks for Egypt and the Gulf to find where you actually stand.

3. Reduce lost orders

In COD this is the cleanest win you can get, because the ads for these orders are already paid for. Faster confirmation, a shorter form, fewer steps.

In the case of the store where we removed the cart, lost orders fell 21.7% in a month, without one extra pound in ads.

The rule to go by

Before you ask "How much should I add?", answer these three:

What's my margin after all costs? (Not just after product cost)
What's my break-even ROAS? (1 ÷ margin)
What's my delivery rate? (If COD)

Anyone who doesn't know these three is running on luck, whatever they call their business. Once you know them, you stop asking "Is this campaign good?" and start asking "Is this campaign above my break-even point or below it?" And that question has one right answer.