Lead Value Calculator

Enter your average sale, close rate, and margin to see exactly what one lead is worth — and the most you can pay for it without losing money.

📖 How it works & FAQ

Average sale value ($)

Lead-to-sale close rate (%)

Gross margin (%)

Profit cushion (%)

What a lead is really worth

A lead is worth the profit it is expected to produce, discounted by the odds it never buys. The formula is simple: lead value = average sale value × close rate × gross margin. If your average sale is $500, you close 20% of leads, and your gross margin is 60%, each lead carries an expected gross profit of $500 × 0.20 × 0.60 = $60. That one number turns fuzzy marketing debates into a hard budget line. Everything runs live in your browser — your numbers never leave your device.

From lead value to max cost per lead

Your break-even cost per lead is exactly the lead’s value: pay $60 to acquire a $60 lead and marketing eats every dollar of profit. That is why the calculator also asks for a profit cushion — the share of each lead’s value you want to keep. With a 30% cushion, the most you should pay for that $60 lead is $42. Compare that ceiling to each channel’s real cost per lead (ad spend ÷ leads generated) to see which channels to scale and which to cut. These figures are estimates only, not professional, financial, tax, or legal advice.

How to use it

Enter your average sale value — total revenue divided by number of sales works fine.
Enter your close rate: out of every 100 leads, how many become paying customers?
Enter your gross margin — the percent of revenue left after the direct costs of delivering the product or service.
Set a profit cushion, then read the cards: lead value, max cost per lead, expected revenue per lead, and leads needed per sale.

FAQ

What close rate should I use?: Your real historical rate: closed deals divided by total leads over the last 3–6 months. If you track pipeline stages, use lead-to-customer, not lead-to-appointment.
Why multiply by gross margin?: Because you can only spend profit, not revenue. A $500 sale at a 60% margin leaves $300 to cover marketing and overhead — skipping the margin step is how businesses overbid for leads and lose money on every sale.
What about repeat customers?: If customers typically buy again, use lifetime gross profit instead of a single sale value. That raises the lead value and lets you outbid competitors who only count the first order.
Does this work for service businesses?: Yes — use your average job or contract value and the margin left after direct labor and materials. The math is identical.