BER — break-even ROAS — is the return on ad spend at which an order stops losing money. Spend $10 on ads to make $10 of margin and you’ve worked for free; anything above your BER is profit, anything below is a donation to the ad platform. It’s the single number every dropshipping campaign should be judged against, and in 2026 most sellers are calculating it wrong — because they’re using pre-tariff product costs.
The formula
BER = selling price ÷ contribution margin per order, where contribution margin is what’s left after every cost except advertising:
- Landed product cost — factory price + shipping + import duties, not the supplier list price
- Payment processing — typically 2.9% + $0.30 on Shopify Payments
- Platform and app fees, packaging, and your expected refund rate
If a $59.90 product costs you $24 all-in, your margin before ads is $35.90 and your BER is 59.90 ÷ 35.90 ≈ 1.67. A ROAS of 2.0 makes money; 1.5 loses it, even though the dashboard looks green.
The 2026 mistake: quoting cost without duties
Since the de minimis exemption ended, every parcel from China clears customs formally and pays Section 301 duties plus the 15% Section 122 surcharge. A product that landed for $18 in 2024 can land above $24 today. Sellers who still calculate BER from the AliExpress price are scaling campaigns that quietly lose money on every order.
Use the true DDP (delivered duty paid) cost per unit — our guide to calculating landed cost under Section 301 and Section 122 walks through the math, and DDP versus DDU shipping explains why the duty should be in your unit price rather than your customer’s doorstep.
Worked example
- Selling price: $59.90
- Landed DDP cost (product + shipping + Section 301 + Section 122): $22.00
- Payment fees (2.9% + $0.30): $2.04
- Refund reserve at 3% of price: $1.80
Contribution margin = 59.90 − 22.00 − 2.04 − 1.80 = $34.06. BER = 59.90 ÷ 34.06 = 1.76. Write that number on a sticky note before you open Ads Manager.
When to kill and when to scale
- Kill an ad set that sits below BER after spending roughly 2× your selling price with no sales trend improving.
- Watch anything between BER and about 1.3× BER — it’s paying the bills, not building a business.
- Scale when ROAS holds above ~1.3× BER across a full week, raising budget 20–30% at a time so the algorithm doesn’t reset learning.
One more lever: BER falls when cost falls. Negotiating the factory price directly — instead of paying a marketplace markup — often moves BER more than a month of creative testing. That’s the core of what a private dropshipping agent does; if you want to see the numbers for your own product, request a free landed-cost quote and recalculate your BER with real 2026 figures.
Private Agent for Dropshipping Success