Compare the cost of leads and new customers with the contribution each sale brings. Start with time sheets, engagement scopes and invoice ageing. Each example below uses hypothetical values you can replace.
Customer Acquisition Cost
Measure combined sales and marketing cost per new customer.
CAC = (marketing + sales costs) / new customers
Show example inputs and result
| Marketing spend | 3,000 |
|---|---|
| Sales labour and software | 1,000 |
| New paying customers | 20 |
Result: 200 per customer.
A media-only cost per acquisition excludes proposal and selling work. Report the included cost categories so comparisons remain meaningful.
Open customer acquisition costExpected Contribution per Lead
Estimate first-sale contribution expected from a lead.
Lead value = close rate × (sale revenue − variable cost)
Show example inputs and result
| Lead-to-sale rate | 20 % |
|---|---|
| Average first policy sale revenue | 1,000 |
| Variable first-sale cost | 650 |
Result: 70 per lead.
Expected contribution is a ceiling before overhead and desired profit, not a recommended bid. Averages can hide low-quality leads.
Open expected contribution per leadAffordable Acquisition Spend
Set a contribution-based ceiling for first-sale acquisition.
Maximum spend per lead = (revenue − delivery cost − retained contribution) × close rate
Show example inputs and result
| First-sale revenue | 800 |
|---|---|
| Variable delivery cost | 500 |
| Contribution to retain | 100 |
| Qualified lead close rate | 25 % |
Result: 50 per qualified lead.
A negative ceiling means the required retained contribution already exceeds the sale contribution. Repeat revenue is excluded.
Open affordable acquisition spendAcquisition Budget
Work backward from a customer target to a lead-spend scenario.
Budget = target customers / close rate × cost per lead
Show example inputs and result
| Target new customers | 30 |
|---|---|
| Lead-to-customer rate | 20 % |
| Cost per qualified lead | 30 |
Result: 4,500 .
A lower close rate requires more leads for the same customer target and raises the acquisition budget.
Open acquisition budgetConversion Improvement Break-Even
Find the improvement needed to pay for a sales process change.
Required close-rate improvement = cost / (leads × contribution) × 100
Show example inputs and result
| Monthly improvement cost | 1,000 |
|---|---|
| Monthly qualified leads | 200 |
| Contribution per extra sale | 250 |
Result: 2 percentage points.
Compare percentage points, not percentage growth. Values above 100 points are unattainable.
Open conversion improvement break-evenReferral Incentive Economics
Check first-sale contribution after a referral incentive.
Retained contribution = revenue × contribution margin − reward − program cost
Show example inputs and result
| First-sale revenue | 800 |
|---|---|
| Contribution margin | 40 % |
| Referral reward | 75 |
| Program cost per sale | 25 |
Result: 220 per referred sale.
Compare with the contribution remaining after delivering the sale. Revenue alone overstates the amount available for rewards.
Open referral incentive economicsUse the results in your plan
For a insurance agency business, review lead costs, service time, and renewal work across the complete workflow. Use one consistent period and delivery unit: a policy sale. Compare the assumptions with recorded outcomes after delivery, then update the estimate.
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