What can you afford to pay for a lead?
Before you spend a dollar on ads, know your ceiling. Enter four numbers from your own business to see your break-even cost per lead, a comfortable target, and the monthly budget that gets you more jobs.
Comfortable cost per lead
Keeps about two-thirds of the gross profit from each new job.
- Gross profit per job
- $3,150
- Break-even cost per lead
- $630
- Leads needed per month
- 20
- Monthly ad budget at target
- $4,200
- Revenue from those jobs
- $36,000
How the math works
Gross profit per job is your average job value times your margin. Break-even cost per lead is that profit times your close rate: if you close one lead in five, you can spend up to a fifth of a job's profit on each lead before ads stop paying for themselves.
The comfortable target is a third of break-even. Leads needed is the number of jobs you want divided by your close rate, and the monthly budget is those leads at the target cost.
The biggest lever usually isn't cost per lead. It's close rate. Calling every lead within five minutes and following up for a week can move it more than any ad change, and it raises what you can afford to pay for each lead.
Want help reading your numbers? Tell us about your business and we'll walk through them on a free 15-minute call.
Calculator FAQ
What is a good cost per lead for contractors?
There's no universal number. A $150 lead is cheap for a remodeler who closes one in four at a $40,000 average, and expensive for a company doing $800 jobs. The right ceiling comes from your own job value, margin and close rate, which is what this calculator works out.
Why aim for a third of break-even?
Break-even means every dollar of gross profit from new jobs goes back into ads. Keeping cost per lead at about a third of break-even leaves roughly two-thirds of that profit with you, plus room for slow weeks and leads that take longer to close.
What close rate should I use?
Use the share of leads that become paid jobs, not the share of estimates you win. If you don't track it yet, count the last 20 inquiries you got and how many turned into work. Leads from ads usually close at a lower rate than referrals, so be conservative.
See if your area is still open
We work with one company per trade in each service area. Tell us where you work and what you do, and we'll tell you honestly whether lead ads make sense for you.
- Flat monthly fee
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- Your ad account, your data