[ Free tool · Ads and growth ]
CAC and payback period calculator
Customer acquisition cost is the full cost of winning one new customer. Add monthly revenue and margin to see how many months it takes to earn that cost back.
CAC (customer acquisition cost)
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Enter two numbers to see the result.
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[ How to use it ]
How to use the CAC and Payback Calculator
- Add up everything spent to win customers in a period: ads, agency or freelancer fees, sales salaries, tools.
- Enter the number of new customers won in the same period.
- Optionally add average monthly revenue per customer and gross margin to get the payback period.
[ Explained ]
How CAC and payback are calculated
- CAC
- Total sales and marketing cost ÷ new customers
- Payback (months)
- CAC ÷ (monthly revenue per customer × gross margin)
- Example
- Cost 3,00,000, 60 customers: CAC = 5,000. At 1,500 a month and 60% margin, payback = 5,000 ÷ 900 ≈ 5.6 months.
A shorter payback means cash comes back sooner to fund more growth. If customers often leave before the payback point, you are losing money on them.
[ FAQ ]
Questions about the CAC and Payback Calculator
Should CAC include salaries?
For a true, fully loaded CAC, yes: include the share of sales and marketing salaries, agency fees and tools. A paid-only CAC that counts just ad spend is useful too, but label it clearly.
What is a healthy LTV to CAC ratio?
Many subscription businesses aim for customer lifetime value of around three times CAC, but treat it as a rule of thumb, not a law. Use the LTV calculator to work out yours.
How is CAC payback different from ROAS?
ROAS measures revenue against ad spend immediately. Payback measures how long the gross profit from a customer takes to cover the full cost of winning them, which suits subscription and repeat-purchase businesses better.
[ An invitation ]
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