Should I judge lead sources on revenue or on profit?

Where the ranking inverts

Consider two sources. One produces large installation work with significant equipment and subcontractor content. The other produces diagnostic and repair work that is mostly labor. The first will show a far higher revenue per lead. Whether it shows a higher gross margin per lead depends entirely on your cost structure, and in many businesses it does not.

This is not an argument against big jobs. It is an argument against ranking demand sources on a number that ignores what the work costs to deliver.

What honest job costing requires

Gross margin per job needs labor hours actually worked on that job, material and equipment cost applied to that job, and subcontractor cost where relevant. Most field service systems can carry all three. Most companies populate one of them well, one partially and one not at all.

Partial job costing is worse than none, because it produces precise-looking margin figures that are systematically wrong in the same direction. If technician time is not captured per job, your labor-heavy work will look artificially profitable, which is precisely the comparison you were trying to make.

• Labor. Hours on job, at loaded cost, including drive time if you want the number to be real.
• Materials and equipment. Applied to the job, not to a monthly purchasing total.
• Subcontractors. Frequently the largest single gap in home services job costing.
• Warranty and callback cost. Charged back to the original job, or your margin by job type is fiction.

A workable intermediate step

If full job costing is a year away, use a hybrid. Establish an average gross margin percentage per job type from whatever costing you do trust, then apply those percentages to each source's actual job type mix. The result is not a true margin per lead, but it captures the mix effect, which is where most of the inversion comes from.

Label it as modeled margin so nobody mistakes it for measured margin. It is usually enough to change an allocation decision, and it can be built from data you already have.

What margin still will not tell you

Gross margin per lead ignores customer lifetime value, and in service businesses that omission favors one-time high-ticket work over relationships. A repair customer who becomes a maintenance member and later a replacement customer can outperform a single install that never comes back.

So use margin per lead for near-term allocation and pair it with retention and repeat-rate data before making structural decisions about which demand you want. That pairing is exactly what customer intelligence adds to revenue reporting.