What does it really cost you to win a customer?
Ask an owner what a new customer costs and you usually get one of two answers. "I don't really spend on marketing." Or the price of one lead from a lead service.
Neither one is the number. The number is CAC, the cost to acquire a customer. It's one of the three numbers every private equity backed company in your market knows cold, and the one most independent owners skip.
How to work it out
Take one month. Add up everything you spent to win work:
- Ads, lead services and directory fees
- Your website, software and tools that bring in leads
- What you paid anyone to sell, call back or follow up
- Partner dues, events and sponsorships
Then divide by the number of new customers you won that month. Not leads. Not estimates. Customers who signed.
Spend $3,450 and win 14 new customers, and your CAC is about $246.
Why it matters more than cost per lead
Cost per lead is easy to see, so it's the number everyone watches. But a cheap lead that never books isn't cheap. A lead service can send you $40 leads and still cost you $900 a customer, because so few of them close.
CAC counts what actually matters: what it took to put a signature on a contract.
Work it out by channel
One CAC for the whole business is a start. CAC by channel is where the money is. Run the same math for each place your work comes from: paid ads, lead services, partners, referrals, organic, outbound and repeat customers.
You'll usually find one channel winning customers for a fraction of what another one costs. That's where your next dollar goes.
Don't forget your time
Some channels cost almost nothing in dollars and a lot in hours. A networking group, door knocking, posting every night. If you leave your time out, those channels look free. They aren't.
That's why we score channels with ROES, Return on Effort Spend. It counts your dollars and your hours on the same scoreboard.
CAC is half a sentence
CAC on its own doesn't tell you if a customer was worth winning. A $500 CAC is a bargain on a $15,000 foundation job and a disaster on a $300 service call. You need the other two numbers: what the job costs to do, and what the customer is worth over the whole relationship.
Private equity backed companies win because they know all three. When they know $500 in ads turns into a $15,000 job, they keep spending while everyone else is scared to.
You can know the same thing. It takes one afternoon and a spreadsheet. The monthly worksheet for it is in our free playbook.
Not sure where your business stands yet? Our free Growth Ladder assessment takes about four minutes.
- Run It Like They Would, The Next Right Move (2026)
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