Break-Even Analyzer

What gross margin should I use for my trade?

Roofing: 35-45%. HVAC (service): 30-40%, (installs): 15-25%. Plumbing service: 40-50%. Remodeling: 25-35%. Pressure washing: 55-65%. Pest control (recurring): 50-60%. Use your actual historical margin if you have it — these are industry averages.

Should management fees be included?

Yes — they're a real monthly cost. The tool defaults to $1,500 (typical retainer). If you're running ads in-house, set it to $0 plus your real internal time cost.

What happens above break-even?

Every additional job is pure profit × margin. If break-even is 3 jobs and you book 10, jobs 4-10 are 7 × (job value × margin) in profit. That's where the ROAS math gets exciting.

How is this different from the ROI calculator?

ROI Calculator projects full-funnel results from ad spend + CPL + close rate + job value. This Break-Even tool answers the simpler question: 'what's the minimum job count I need to be profitable?' — useful for setting realistic minimum-volume goals.

Does break-even change month-to-month?

Yes — seasonally and with offer changes. Your winter break-even job count might be 8 (smaller average job, tighter margin); your summer peak might be 12 (bigger jobs but more competition eats margin). Recalculate quarterly or whenever you change pricing, materials cost, or ad spend. A stale break-even number can make you falsely believe you're losing or winning.

What's the difference between break-even and 'profitable'?

Break-even = revenue covers ad + management costs. Profitable = revenue covers ad + management + cost-of-goods + overhead + your salary. Most contractors who hit break-even on Meta still aren't profitable on the broader business. Aim for 2-3x break-even job count to be genuinely profitable after all real costs. Use this tool to set the floor; use the ROI Calculator to project the ceiling.

Should I include cost-of-goods in margin or treat it separately?

Include it in margin. The 'Gross Margin on Jobs' field should = (Job Value − COGS) / Job Value. So if you sell a $4,000 roof for $4,000 with $2,400 in materials + sub-labor, your margin is 40%. The remaining $1,600 covers ad spend, management fees, your time, and net profit. Don't double-count COGS by trying to factor it elsewhere — keep margin clean and consistent.

How does the break-even point change for trades with strong recurring revenue (pest control, lawn care)?

Recurring revenue dramatically lowers your effective break-even. If a $300 monthly pest service customer stays 18 months, real lifetime revenue is $5,400, not $300. So a $300 cost-per-acquisition that looks unprofitable on first invoice ($300 cost vs $300 revenue) is actually a 18x return at LTV. For recurring trades, replace 'first job value' with 'expected 12-month customer value' in the Job Value field — you'll see break-even drop to 1-3 customers per month even at premium ad spend. Run the LTV Calculator (/tools/ltv-calculator) to lock in your real lifetime number first; then plug it into break-even for the right answer.

What if my margin varies dramatically between job types — should I run break-even per service line?

Yes, separately. Most contractors have 2-3 service lines with different margins: a roofing company might have repair (60% margin, $2K avg ticket) and replacement (35% margin, $12K avg ticket). Running blended numbers in this calculator gives you a fictional 'average' break-even that matches no actual job type. Better: run the calculator twice — once with repair numbers, once with replacement numbers. You'll see two different break-even thresholds. Then set ad campaigns + creative to match each segment ('Free leak inspection — same-day' for repairs vs 'Whole-roof replacement consultation' for replacements). Most contractors blend them and accidentally optimize for whichever has bigger volume — usually losing the higher-margin segment to inattention.

How do I account for fixed overhead (insurance, vehicles, office, salaries) in the break-even math?

Don't include fixed overhead in this calculator — it would distort the unit-economics question. This calculator answers: 'For each marginal job, am I profitable on the ads that brought it?' Fixed overhead is paid regardless. Better approach: run THIS calculator first to confirm marginal profitability (each booked job covers ad cost + COGS); then separately calculate 'how many TOTAL booked jobs do I need monthly to cover fixed overhead?' = monthly fixed cost ÷ (avg job value × gross margin). Two different math problems: (1) ad campaign profitability per job (this tool); (2) overall business break-even per month (separate calc). Conflating them gives you an artificially-high break-even number that makes profitable campaigns look unprofitable. Keep ad math + overhead math in separate buckets.

What's the right way to read this calculator's output to know whether I should INCREASE or DECREASE budget?

Three-zone interpretation: (1) ZONE A (jobs booked > 1.5x break-even) — ad spend is profitably amplifying revenue. INCREASE budget by 15-20% per 3-week window until you exit this zone; (2) ZONE B (jobs booked between 1.0x and 1.5x break-even) — ads are profitable but tight. HOLD budget; focus on improving close rate or offer to push back into Zone A; (3) ZONE C (jobs booked < 1.0x break-even) — ads are unprofitable. DECREASE budget by 30-40% AND audit fundamentals (offer, creative, targeting). Most contractors operate in Zone B for months without realizing it — they're 'breaking even' but not actually growing. Push for Zone A with tactical changes (better offer, fresh creative, fixing follow-up speed) BEFORE adding more budget. More money on Zone B campaigns just means more break-even spend; the path to profit is moving the campaign INTO Zone A first, then scaling.

How does break-even change when I'm running multiple campaigns simultaneously vs a single campaign?

Run break-even per campaign separately, then aggregate. Why: each campaign has different CPL + close rate + job value combinations. A 'good' campaign in Zone A subsidizes a 'bad' campaign in Zone C — your aggregate looks healthy while you're actually wasting half your budget. Run THIS calculator per campaign or per major audience-creative-offer combo. Identify Zone C campaigns + cut or fix them. Identify Zone A campaigns + scale them. Your aggregate break-even should drift downward over time as you prune the losers. Most contractors run aggregate-only break-even, see 'we're profitable overall,' and never notice that 30-40% of their spend is on losing campaigns kept alive by winning ones. Per-campaign discipline is how you progress from 'profitable on average' to 'profitable on every line item.'

How do I model the impact of price increases on my break-even point — does charging more help or hurt?

Price increases dramatically lower break-even AND raise total profit. The math: if your job value goes from $5K to $6K (20% increase) at the same gross margin %, your per-job profit jumps proportionally. Break-even job count drops by ~17%. Example: at $5K avg job × 35% margin = $1,750 gross profit per job. Monthly fixed costs $5K = 2.86 break-even jobs. Same business with $6K avg job × 35% margin = $2,100 per job. Break-even = 2.38 jobs. The 20% price increase results in ~17% fewer break-even jobs needed. Combined with typical effects of pricing power (slight close rate decrease offset by margin expansion), most contractors find a 10-20% price increase doesn't reduce booked-job revenue meaningfully but DOES improve unit profitability. Run the calculator with your current numbers, then run again with prices raised 15%. The delta is usually significant. Most contractors fear price increases will reduce volume; the math + market data shows they typically INCREASE total profit by improving unit economics far more than they reduce volume.

How do I model break-even when I'm running a sale or seasonal discount that temporarily reduces my margin?

Discount campaigns require recalculating break-even at the discounted economics. Example: standard pricing $8K avg job × 35% margin = $2,800 gross profit per job. Discount campaign at $6.5K avg × 25% margin (lower because discount eats margin) = $1,625 gross profit per job. With $5K monthly fixed costs, standard break-even is 1.79 jobs/mo; discount campaign break-even is 3.08 jobs/mo. The discount requires 72% MORE booked jobs to break even — meaning if your discount doesn't drive significantly more volume, you're worse off. Three-way decision framework: (1) MODEL standard break-even; (2) MODEL discount break-even; (3) ESTIMATE the volume lift the discount needs to drive — if you can't realistically generate 70%+ more bookings, the discount loses money. Most contractors run discount sales without doing this math + lose money for a quarter without realizing it. Discounts can work, but only if you've math-tested the volume requirement first.

How do I read a break-even result that says I need 4-5 booked jobs/mo when I'm only currently doing 2/mo — should I just quit?

Don't quit; diagnose. If break-even shows 4-5 jobs/mo and you're at 2/mo, three potential meanings: (1) AD SPEND too low — at 2 jobs/mo with reasonable CPBJ, you might be spending only $400-800/mo of ad budget. Most contractor accounts need $1,500-3,000/mo minimum to optimize properly + generate enough volume; (2) FIXED COSTS too high — if your business overhead is $5K/mo but you're solo + no employees, audit what's eating the budget (vehicles, insurance, software stack). Often $2K/mo can be cut by reviewing line items; (3) PRICING too low — your $5K average job might be $7K in your market with proper offer + sales script; raise prices, watch break-even drop. The break-even gap signals one of these three; pick the most fixable. Most contractors at the 'currently below break-even' stage assume the answer is 'sell more' (hard) when it's actually 'cut overhead' or 'raise prices' (easier). Run the diagnostic before concluding the business is broken.

How does break-even change as the business grows from solo-operator to 5-employee team to 20-employee team?

Each team-size threshold requires recalculating break-even at the new fixed-cost structure. Three growth-stage thresholds: (1) SOLO ($0-50K/mo revenue) — fixed costs $2-5K/mo (vehicle, insurance, basic software); break-even at 1-3 booked jobs/mo for typical $5K trades; (2) SMALL TEAM (3-7 employees, $50-200K/mo revenue) — fixed costs jump to $25-50K/mo (payroll, benefits, larger vehicles, expanded software, office space); break-even at 8-15 booked jobs/mo. The big jump happens between solo + first hire — overhead 5-10x while productive capacity only 2-3x; (3) LARGER TEAM (10-20 employees, $200K+/mo) — fixed costs $80-150K/mo; break-even at 20-40 jobs/mo. Operations efficiency matters more than growth speed at this scale. Run the calculator at each transition point + plan your hiring against break-even thresholds. Most contractors hire reactively (once they're swamped) without recalculating break-even at the new fixed cost — find themselves losing money for 2-3 months post-hire because revenue didn't catch up to overhead.