CAC Payback Calculator
I learned the hard way that throwing money at ads without knowing your payback period is a fast track to burning through cash. This calculator shows you exactly how long it takes to recover what you spend acquiring customers—and more importantly, when you should panic.
CAC Payback Analysis
Calculate how long it takes to recover customer acquisition costs and understand your customer economics.
Business Model & Costs
How customers typically buy from you
Total cost to acquire one customer
Average amount customers spend per order
Profit margin after product costs
Customer Behavior
How many times customers buy per year
Percentage of customers who return next year
Payback Analysis
Payback Period
1 months
Time to recover CAC
Profit per Purchase
$0.00
Gross profit per order
Monthly Profit/Customer
$0.00
Average monthly contribution
LTV:CAC Ratio
0.00
Needs improvement
Risk Assessment: Low Risk
LTV:CAC ratio is too low. Focus on increasing customer lifetime value.
Lifetime Value Metrics
Customer LTV
$0.00
Total lifetime profit
Year 1 Profit
$0.00
Cumulative profit after 12 months
Cumulative Cash Flow
Master Customer Acquisition
Learn realistic strategies for improving your customer acquisition payback and building sustainable growth.
Read the CAC Payback Guide →What CAC Actually Means (And Why Most People Screw It Up)
Customer Acquisition Cost (CAC) is every single dollar you spend to get someone to buy from you for the first time. Here's where most merchants mess up—they only count their Facebook ad spend and forget about the other $500 they're bleeding every month on Klaviyo, their VA who manages ads, that expensive agency retainer, and the 47 other tools they "need" for marketing.
The real CAC formula: Everything you spent on marketing Ă· New customers who actually bought something = Your actual CAC
I remember thinking my CAC was $15 because that's what Facebook told me. Reality check: when I actually added up my email tools, agency fees, and that conversion optimization tool I barely used, my real CAC was $31. That's over double what I thought I was spending per customer.
The Payback Period: When You'll Actually See Your Money Again
Your CAC payback period is how long you wait to get your money back from a customer. This isn't some theoretical number—it's literally how long your cash is tied up before you break even on that Facebook ad spend.
I learned this the expensive way when I was burning through $3K/month on ads but my average payback was 8 months. Sounds fine until you realize I needed that cash to buy inventory for Q4. I was basically funding a very slow, very expensive loan to myself.
Reality check: If you're on Shopify paying 2.9% + 30¢ per transaction, selling on Amazon with their 15% cut, or dealing with any subscription business model, you need your payback period under 6 months or you're playing a dangerous cash flow game.
How to Actually Use This Thing (No BS Instructions)
- Your real CAC: Add up everything—ads, tools, agencies, the works. Don't lie to yourself.
- Average Order Value: What new customers actually spend, not your dream number
- Gross Margin: Your profit after product costs and platform fees (yes, include Shopify's cut)
- Purchase Frequency: Be honest—most customers don't buy monthly like you wish they would
- Retention Rate: The percentage who stick around each month (hint: it's lower than you think)
Here's what I wish someone told me early on: be brutally honest with these numbers. I used to plug in optimistic retention rates and frequency because I wanted better results. All that did was hide the fact that I was hemorrhaging money on customer acquisition. The truth might hurt, but at least you'll still have a business when Q4 rolls around.
Every Expensive Mistake I Made (So You Don't Have To)
❌ What I Did Wrong
- Only counted Facebook ad spend (ignored my $200/month tool stack)
- Used revenue numbers instead of actual profit (rookie move)
- Assumed everyone would be a repeat customer (they weren't)
- Calculated CAC during my best month only (July was not typical)
- Forgot about seasonal fluctuations in my jewelry business
âś… What Actually Works
- Track every penny: ads, Klaviyo, Shopify apps, your time
- Use net profit after ALL fees (platform, payment, shipping)
- Accept that 70% of customers buy once and ghost you
- Average CAC over 6+ months to account for seasonality
- Build in extra buffer for Q4 inventory cash needs
Red Flags That Should Make You Sweat
Time to panic when:
- Payback period hits 9+ months: I've been here—you'll run out of cash before you break even, especially if you need to restock for holidays
- You're spending more to acquire than customers ever pay back: This is just expensive charity work with extra steps
- Your CAC keeps climbing while AOV stays flat: iOS updates, competition, or your creative is getting stale. Time to pivot strategy.
- Summer CAC looks great but you sell winter coats: Seasonal businesses need 3-4 month payback periods or you'll be scrambling for inventory cash when it matters
- You're on a payment plan for your ad spend: If you're putting Facebook ads on a credit card because cash flow is tight, stop everything and fix this first
Ready to Actually Fix Your CAC Problem?
I've written up everything I learned from burning $50K+ on inefficient customer acquisition— including the exact strategies I used to cut my payback period from 8 months to 3, platform-specific tricks for Shopify vs Amazon, and seasonal cash flow planning.
Get the Full CAC Optimization Guide