"How many leads do I need?" has a real answer, and it takes about four minutes of arithmetic to find.
It also has a better version of the question hiding inside it, which is worth getting to first: in a typical residential HVAC business, roughly nine jobs a month produce about 72% of the revenue. Everything else is volume.
So the useful question is not how many leads you need. It is how many of one particular kind.
The short answer
Four steps, run once per service line rather than once for the business. Revenue target, divide by average job value, divide by close rate, multiply by cost per lead. The blended version gives you a budget; the split version tells you what to actually go and get, and the two produce very different plans.
Step 1: the arithmetic
Take a $1.5 million annual target, which is $125,000 a month.
| Step | Calculation | Result |
|---|---|---|
| Monthly revenue target | $1,500,000 ÷ 12 | $125,000 |
| Jobs needed | $125,000 ÷ $1,600 blended ticket | ~78 jobs |
| Leads needed at 50% close | 78 ÷ 0.50 | 156 leads |
| Budget at $149 per lead | 156 × $149 | $23,244/month |
That is the calculation almost every article on this topic stops at, and the $1,600 blended residential ticket it uses is a real, well-sourced 2026 figure.
It is also the wrong number for your business, and the error runs in the dangerous direction.
Step 2: split it, because the blend lies
A blended average ticket treats a $10,000 replacement and a $150 tune-up as the same event. They are not remotely the same event, they do not come from the same leads, and they do not close at the same rate.
Here is the same $125,000, modelled honestly:
| Service line | Jobs | Avg value | Revenue | Close rate | Leads needed |
|---|---|---|---|---|---|
| System replacement | 9 | $10,000 | $90,000 | 30% | 30 |
| Repair | 40 | $650 | $26,000 | 60% | 67 |
| Maintenance / tune-up | 60 | $150 | $9,000 | 50% | 120 |
| Total | 109 | $125,000 | 217 |
Note what just happened to the job count. The blended calculation said 78 jobs. The split model says 109, because the real average ticket in this mix is about $1,147, not $1,600.
The published blend is not wrong; it describes a different mix. A shop running sixty tune-ups a month has a lower blended ticket than one running twenty, and planning off the industry figure would have under-ordered leads by 40% while looking perfectly rigorous on a spreadsheet.
Beyond the count, the split gives completely different instructions.
Nine replacements produce 72% of the revenue, and they need thirty estimate opportunities a month. Thirty. That is a number a single person can own, track by name, and follow up individually. The other 187 leads keep technicians busy and feed next year's replacements, but they are not where the business is won.
By the numbers
Run this split on your own numbers before anything else. Most contractors discover that the service line producing the majority of their revenue accounts for a small minority of their leads, and that nobody in the business is specifically responsible for those particular thirty conversations.
Step 3: the lever nobody uses
Now the finding that should change where the next dollar goes.
At 109 jobs a month, here is what different close rates require:
| Close rate | Leads needed | Monthly cost at $149 |
|---|---|---|
| 10% | 1,090 | $162,410 |
| 15% | 727 | $108,323 |
| 20% | 545 | $81,205 |
| 25% | 436 | $64,964 |
| 30% | 363 | $54,087 |
| 35% | 311 | $46,339 |
| 40% | 273 | $40,677 |
| 50% | 218 | $32,482 |
Moving from 25% to 30% saves about $10,900 a month. Over $130,000 a year.
Five percentage points. Not a new channel, not a bigger budget, not better creative. Five points of close rate, which in this trade is very often just answering faster.
The reason that is realistic rather than optimistic: only 11% of HVAC businesses reply to a new lead within an hour, the slowest of any trade, while contacting a lead within five minutes makes you 21 times more likely to qualify it than waiting thirty. And 41% of online bookings arrive outside business hours, when most contractors are not answering at all. There is genuine, uncaptured close rate sitting in those three numbers, and it costs almost nothing to go and get. The mechanics are in why your HVAC leads are not converting.
The general rule is worth stating plainly: improving conversion is almost always cheaper than buying volume, and it is the only one of the two that makes every future lead more valuable as well.
We start by building this table for your business with your real numbers, because most contractors have never seen their own close rate by source. Frequently the conclusion is that you need fewer leads rather than more, and we would rather tell you that than sell you volume.
Step 4: seasonality, because the monthly average is a fiction
Nobody in HVAC does 109 jobs in February and 109 in October.
October is typically the busiest month in the trade, which surprises people who assume peak summer. The heating season announcement arrives when the first cold snap hits and a system that sat idle since March fails to start. Summer has its own spike, and the shoulder months are genuinely quiet.
A workable planning shape:
| Period | Multiplier | Jobs | Leads |
|---|---|---|---|
| Peak months | 1.5x | ~164 | ~326 |
| Normal months | 1.0x | 109 | 217 |
| Shoulder months | 0.6x | ~65 | ~130 |
Two consequences that cost real money if ignored:
Buy before the season, not during it. Costs spike exactly when demand does, because every competitor bids at the same moment. Pre-season money goes considerably further, and the timing is less obvious than it looks. That is the subject of the best time of year to advertise HVAC.
Do not judge a channel on a shoulder month. A campaign that looks broken in April may be performing normally for April. Compare like periods across years, not consecutive months.
Step 5: turn it into a budget
Cost per lead is not one number either. It varies about 4.7x by service line: heating repair around $144, general HVAC $198, AC repair $231, indoor air quality $274, water heater $343, with Performance Max at $72 and non-branded blended at $149.
So the budget for the split model:
| Service line | Leads | Realistic CPL | Monthly budget |
|---|---|---|---|
| Replacement | 30 | ~$200 | $6,000 |
| Repair | 67 | ~$190 | $12,730 |
| Maintenance | 120 | ~$45 (Meta) | $5,400 |
| Total | 217 | ~$24,130 |
That is roughly $8,000 a month cheaper than the blended calculation, purely because each line is bought through the channel that suits it. Maintenance bought on Meta rather than search accounts for most of the gap, and it is the right channel for it: nobody searches for a tune-up, but they can be sold one. The channel-by-channel breakdown is in the best lead sources for HVAC companies and the price detail in what HVAC leads cost.
Also note that this budget assumes every lead is purchased, which is never true. Referrals and repeat customers each account for 59% of leads for home service businesses and cost nothing, so the real paid requirement is the gap between what your existing base produces and what the plan needs. Measure that gap before funding it.
What to do if the number is unaffordable
It usually is, the first time someone runs it. Three levers, in order of how quickly they pay back:
Raise the close rate. Cheapest by a distance, per the table above. Response speed, follow-up cadence, and a website that lets someone become a lead without phoning.
Change the channel mix. Local Services Ads at $40 to $80 per lead and a 20% to 35% close rate produce a booked job for roughly $218 against $662 on non-branded search. Same budget, three times the jobs.
Raise the average ticket. Maintenance plans, indoor air quality, and a deliberate mix toward replacement rather than repair. Every dollar added to average ticket reduces the jobs required, which reduces the leads required, which reduces the budget, and it compounds through all three.
What not to do is scale volume at an unfixed close rate. That is how a business ends up spending $60,000 a month to produce what $30,000 should have produced, entirely convinced the problem is lead quality. Fix the conversion, then buy the volume, in that order. The free fixes worth doing first are in how to get more HVAC leads.
How to actually get your close rate
Step three is the one everything else depends on, and it is the one most contractors cannot answer, so it is worth being concrete about how to produce the number.
You need two counts per source, per month: leads received and jobs won from them. That is it. The difficulty is never the arithmetic, it is that leads arrive through five different doors and nobody writes them all down in the same place.
A workable minimum:
- One list, one place. Every enquiry, whatever the channel, logged the moment it arrives. A CRM is the right tool; a shared spreadsheet beats nothing by an enormous margin.
- Source recorded at intake, not guessed later. Ask every caller how they found you, and record the answer verbatim before the conversation moves on.
- Distinct phone numbers per channel if you can, since "Google" from a caller usually means the map pack, an ad, or an organic result, and those are three different economics.
- Outcome recorded on every lead, including the dead ones. A lead with no outcome silently inflates your close rate, because unresolved files quietly disappear from the denominator.
- One review a month, thirty minutes, comparing leads to jobs by source.
Worth knowing before you reach for the tools you already own: accounting software cannot produce this, because it only records people who paid you and the whole point here is counting the ones who did not, which is the argument in is QuickBooks a CRM.
Two months of this gives you a directionally correct picture. Six months gives you something you can plan a budget around. Nothing else on this page works without it, which is why it is worth starting even in an imperfect form today rather than a perfect form next quarter.
Maintenance plans change the whole equation
There is one line item that does not behave like the others, and it deserves separate treatment because it is the only lever that reduces next year's requirement.
Every other job on the list is a customer you have to acquire again. A maintenance plan customer is one you already have, who calls you first when something fails, and who is far more likely to buy their replacement from you when the time comes.
In the model above, sixty tune-ups a month contribute $9,000, which is 7% of revenue, and cost 120 leads to fill. On a cost-per-lead basis that line looks like the worst on the sheet. Judged as customer acquisition rather than revenue, it is the best, because those sixty households are next year's repair calls and the year after's replacements, at effectively zero acquisition cost.
Which reframes the tune-up line entirely: it is not a revenue line, it is a lead source with a positive margin. That is an unusual thing to own, and it is why contractors with large plan bases can weather a slow season that damages competitors who buy every job fresh.
If you model it forward, each year of plan growth shaves leads off the following year's requirement. Nothing else in this calculation compounds in your favour.
The one-page version
- Monthly revenue target.
- Split it by service line, with real job values for each.
- Divide each line by its own close rate to get leads required per line.
- Multiply each by the right channel's cost per lead to get the budget.
- Apply seasonal multipliers, and buy ahead of the season rather than into it.
- Subtract what referrals and repeat customers already produce.
- Re-run it every quarter, because close rates move and so do lead prices.
Step three is the one that changes businesses. Most contractors have never measured close rate by source, which means every number downstream of it is a guess, and the guess is always optimistic.