How much can you afford to pay for a lead?
Work out the most you can spend to win a job or a qualified enquiry, at break-even and after overheads and profit. Formulas and limits shown in full.
Take what a job brings in, subtract the costs of doing it, and you have its contribution. Spending all of that to win the job is break-even: the job pays for itself and its advertising, but leaves nothing for overheads or profit. Subtract your overhead share and the profit you want to get a planning ceiling, then multiply by your close rate to see what each qualified enquiry can cost.
Four numbers that are easy to mix up
| Term | What it means | Example per job |
|---|---|---|
| Revenue (job value) | What the customer pays you for the job | $900 |
| Variable cost | Costs that exist only because you did this job: labour, materials, travel | $400 |
| Contribution | Revenue minus variable cost. Everything else is paid out of this | $500 |
| Fixed costs (overheads) | Costs you pay whether or not you win the job: rent, insurance, vehicles, software. Spread across jobs as an overhead share | $120 |
| Profit | What is left after variable costs, overheads and the cost of winning the job | $80 wanted |
The formulas
| Result | Formula |
|---|---|
| Contribution per job | Job value − variable cost per job |
| Break-even ceiling per job | Contribution per job |
| Planning ceiling per job | Contribution − overhead share − profit wanted |
| Ceiling per qualified enquiry | Ceiling per job × close rate |
| Ceiling per accepted enquiry | Ceiling per qualified enquiry × qualification rate |
| Minimum revenue per $1 of acquisition cost | Job value ÷ ceiling per job |
The last line is a ROAS-style ratio, but measured against all acquisition costs, not media alone. If your management fee is a separate line, the return you need on media spend will be higher than this figure. E-commerce break-even ROAS calculators work the same way in principle (1 ÷ margin), but they assume each sale arrives directly from the ad. Many service businesses need an enquiry, a quote and a decision first, which is why this calculator works back through close and qualification rates.
Percentages are entered as whole numbers: 40 means 40%. If a ceiling would be zero or negative, or the close rate is 0%, the calculator shows unavailable with an explanation, never a negative budget.
Choosing honest inputs
- Job value: the typical value of the job you want more of, excluding GST. If one service is far more valuable than another, run the calculator once for each.
- Variable cost: only what this job adds. Wages you pay regardless of workload may be closer to a fixed cost; be consistent.
- Overhead share: your monthly fixed costs divided by the jobs you typically complete in a month gives a rough figure. Your accountant can give you a better one.
- Profit wanted: a planning choice, not a fact. Leaving both optional fields blank shows break-even only.
- Close rate: of qualified enquiries, the share that became booked jobs. Use your own recent quotes. If you do not know, use a cautious figure and label it as a guess.
- Qualification rate: of enquiries that reached you, the share worth following up. The qualified lead cost calculator works this out from your own counts.
A worked example
The calculator opens with made-up figures: a $900 job (excluding GST) that costs $400 to deliver, a $120 overhead share and $80 of profit wanted. Four in ten qualified enquiries become jobs, and half of all accepted enquiries are qualified.
| Per | Break-even ceiling | Planning ceiling |
|---|---|---|
| Booked job | $500 (all of the contribution) | $300 ($500 − $120 − $80) |
| Qualified enquiry | $200 ($500 × 40%) | $120 ($300 × 40%) |
| Accepted enquiry | $100 ($200 × 50%) | $60 ($120 × 50%) |
| Minimum revenue per $1 | 1.8 : 1 ($900 ÷ $500) | 3 : 1 ($900 ÷ $300) |
If this business pays $150 in total acquisition cost for each qualified enquiry, it is under break-even ($200) but over its planning ceiling ($120). The jobs still cover their own costs, but they are eating into overheads and profit. That is the point to look at the offer, the lead path or the close rate, not just the bid.
What the result does not tell you
- What you will actually pay. The calculator gives ceilings, not a prediction of what Meta or Google will charge. Compare them with what you pay in practice, using the qualified lead cost calculator.
- Whether repeat work changes the picture. If customers reliably come back, a single job understates their value, but only count that if you have the records to show it.
- Whether you have the capacity. A campaign that pays for itself on paper still fails if nobody can take the extra jobs.
- Anything about cash flow. Advertising is usually paid before the job is, so you need to be able to fund the gap.
- Tax, finance costs or anything your accountant would add. This is a planning aid, not financial advice.
Our Meta Ads budget guide uses the same method to plan a first test. If you would like help applying it, the Meta Ads and Google Ads pages explain how Everest scopes campaign work.