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Calculator guide

How much can you afford to pay to win a customer?

The most you can afford to pay to win a customer is the profit they bring, before overheads: the average sale, minus what it costs you to deliver it, plus repeat business you can reasonably expect. Work that number out first, then compare it with what your ads actually cost per customer, not per click.

By the Moonlighters team. Last updated 12 October 2026.

The idea

Advertising is worth it when a customer brings in more profit than it cost to win them. So you need two numbers: what a customer is worth to you, and what it costs to get one.

Step by step

  1. Average sale. What a typical customer pays for the first job or order, excluding GST.
  2. Cost to deliver. Materials, labour, delivery, card fees and anything else that rises with each sale.
  3. Margin per sale. Average sale minus the cost to deliver.
  4. Repeat business. How many more sales a typical customer makes, if you have records. If you do not, leave it out at first. It is safer to assume only the first sale.
  5. Customer value. Margin per sale multiplied by the number of sales you can reasonably count.
  6. Break-even cost per customer. The customer value, before your fixed overheads. Anything you pay below it brings a profit contribution. Pay above it and you lose money on each customer.

A worked example (illustrative numbers)

Suppose a typical job is NZ$300, and materials and labour cost NZ$180. The margin per sale is NZ$120. If you only count the first job, you can afford to pay up to about NZ$120 to win that customer, and you will want to pay well under it to cover overheads and leave a profit.

A worked example of break-even cost per customer Four stacked boxes: an average job of NZ dollars 300, minus NZ dollars 180 to deliver it, leaves NZ dollars 120 of margin, so you can afford to pay up to about NZ dollars 120 to win one customer. Average job value (excluding GST)NZ$300Minus the cost to deliver it (materials, labour, fees)NZ$180Margin per customer, counting only the first jobNZ$120Most you can afford to pay to win one, before overheadsup to about NZ$120
Illustrative numbers only. Use your own sale value and costs, and pay well under the limit to cover overheads.

Now connect it to your ads

  • Cost per enquiry is ad spend divided by enquiries.
  • Close rate is the share of enquiries that become customers.
  • Cost per customer equals cost per enquiry divided by the close rate.

For example, if enquiries cost NZ$30 and one in four becomes a customer, a customer costs about NZ$120 from ads. That sits right at the break-even in the example above, so you would need to improve the close rate, the average sale or the cost of an enquiry.

Ways to improve it

  • Raise the close rate by following up quickly and clearly.
  • Raise the average sale with sensible packages or add-ons.
  • Lower the cost per enquiry with better creative and landing pages. See the landing page checklist.
  • Increase repeat business with reminders and loyalty offers.

Caveats

  • This is a simplified model. Overheads, seasonality and capacity all matter, so take advice from your accountant for real planning.
  • If you cannot yet trace customers to ads, start with the enquiry tracking guide.

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